For sure 100% people are still gonna be using it though in smaller scale. It's undeniable that majority of usage is always for investment though bitcoin is also good for payment.
If government somehow out of the blue announce to outlaw BTC, people will sell it and price plummets, but guess what, it won't be completely dead, I'd even say it's still gonna be frequently used, the blockchain would still have many transactions.

The biggest downside is just the price going down. But that's about it, we're used to bitcoin at sub 1k anyway. However, there's really slim chance bitcoin gonna be outlawed.