Next step, western governments (correctly) identify bitcoin as a threat to their current policy enforcements. Now we see the narrative spun against bitcoin as a tool of evil powers and criminals. Sooner or later it will be attacked more or less directly. Thus, the governments confirm the motivation for creating bitcoin in the first place to their own citizen. "See, the White House /wants/ to control us. We /need/ tools like it." You could replace bitcoin with any other technology that protects privacy btw. be it Tor, GPG, or whatever.
So what happens now: Will the governments increase the motivation for the developers of said tools in an endless arms race, creating a vicious cycle, where governments trigger the development of better and better tools for criminals? Or will they at some point start to attack the means to actually implement these tools? Will there be a form of arms control for compilers? Like a government-controlled app store?