I agree that although they can't actually technically "shut it down", they can probably create enough fear, uncertainty and doubt to drive the price to the floor. For example by banning businesses from expressing prices in Bitcoin, banning exchanges etc.

But lets think through the implications of such a draconian policy for a minute.

For a start, they'd have to say goodbye to their "we're business and innovation friendly", "we're only worried about laundering" act. The cat really would be out of the bag and police state exposed. Secondly, cryptocurrencies do not know sovereign boundaries. You'd actually have to get a global level of consensus for such a clampdown to have much meaning.

Thirdly, if they did that, bitcoin might actually go up in value because it would be seen the way gold was during the ban on holdings - "to valuable to have in the hands of regular folks".

So I see decentralisation of any kind as being very difficult to regulate. In fact we're not even necessarily talking about cryptos "going mainstream", but simply staying where they are while the fiat system decays.