I realized yesterday that the number one non-speculative use of Bitcoin (to be specific: buying stuff on SR) is already a felony in the US today.

Even if it's regulated, it can't possibly be more illegal than it is now.

I doubt the regulatory environment in the US will have much effect on Bitcoin adoption curves.

it will not be regulated , it will be shut down , plain and simple , unless everybusiness out there accept bitcoins , one needs to convert it to a sound currency in order to use it.

It cannot be shut down for the same reason that Bittorrent cannot be shut down: it is a peer-to-peer decentralized protocol. You need to learn about the basics... http://blog.zorinaq.com/?e=66

I think the basic principal is that it will be unusable within the USA, because you'll have no way to convert US dollars into Bitcoin.

A similar attack was made against Wikileaks.

If you can't transfer your cash to Bitcoin, or your Bitcoin to cash, then the decentralized nature of Bitcoin itself is immaterial.

There are plenty of ways to convert US dollars into Bitcoin, without exchanges.

For one, an often overlooked and dead simple way: you can sell goods/services and tell your customers you accept Bitcoin.

You can buy bitcoins for cash from sellers you meet face to face: https://en.bitcoin.it/wiki/Category:Directories

You can mine.

Etc.

> I think the basic principal is that it will be unusable within the USA, because you'll have no way to convert US dollars into Bitcoin.

You'll have no way to convert electronic dollars into bitcoin. Saying that the government can prevent the conversion of cash into bitcoins is like saying it can prevent the conversion of cash into drugs.

> If you can't transfer your cash to Bitcoin, or your Bitcoin to cash, then the decentralized nature of Bitcoin itself is immaterial.

Unless you can turn your bitcoins into goods and services.

people buy bitcoins for cash in person today. if anything, preventing financial institutions from accepting bitcoins makes the transactions harder to track.