We often deliver news about a certain country acknowledging bitcoin or cryptocurrencies and immediately assume that it is good news because finally they will have clear regulations when it comes to crypto. Another reason why this is considered a pro is because people trust bitcoin more and thinks of it as official when endorsed by the government.
However upon inspection, sometimes you will realize that the government acknowledging bitcoin is not actually a good thing. First of all, the government's acknowledgement is limited to only being a speculative asset and not as a currency that can be used for official transaction. Second, their rules and regulations usually include AML and KYC which totally strips away investors' privacy and disregards decentralization. Third, governments only acknowledge bitcoin to implement high taxes which only drives investors away.
So at the end, not all kinds of acknowledgement is good.
Well, you are right, every thing you've said about the negative side of government acknowledgment of bitcoin is correct, but then, you and I know very well that it's hard for anything to succeed and go mainstream without the government getting involved, allowing it to, most especially when it comes to such things that affects the country's currency and also serves as a means of investment.
Something must be sacrificed to gain something back, we all clamour for worldwide bitcoin adoption, I'm sorry but do you agree that this may not be possible without the government getting involved? And speaking of kyc, I don't see it as a bad thing, and in as much as many of us don't like, it's still has its benefits and advantages.