Bitcoin doesn't have to be sold for Fiat, it can be exchanged for goods or service.
Besides privacy doesn't mean full ghost, if you convert to Fiat nobody knew you had it before or where it came from.
If the merchants accept it, the government will likely know and regulate it.
Do you mean cash? you be private in digital, but you no longer private in real life.
Is that really happening? Could you please provide a source of that info? I would like to read more on it.
What you have mentioned is very true as people don't even understand the rising problems these days.
OFAC-Sanctioned Transactions Being CensoredThe above shows evidence that transactions were censored though by F2pool this I was aware of.
F2Pool is a global miner
https://miningpoolstats.stream/bitcoinHere's where the US based miner censor Bitcoin transaction
https://www.nasdaq.com/articles/mara-pool-and-bitcoin-mining-censorship-2021-05-07If we sum Foundry USA, MARA and LUXOR, they own 39.07% of the current total hash rate
https://hashrateindex.com/hashrate/pools