If the government is forcing you to hand over your possessions (or provide services) it does not matter what currencies they can or cannot print. There is no limit to the strategies available to them...
Example 1
"We're buying your house (whether you like it or not), how many Bitcoins do you want for it?"
"10,000"
"Great. By the way, we just made a new law that says we can pay you in peanut shells as a substitute for Bitcoin, at the same rate."
Example 2
"We're buying your house (whether you like it or not), how many Bitcoins do you want for it?"
"10,000"
"Ok here's your 10,000 Bitcoins"
(10 minutes later...)
"By the way, under the PATRIOT act, we're ordering you to hand over all your encryption keys. Including the private key of your Bitcoin wallet. If you don't make a fuss, we'll be nice and let you keep 1%, and not throw you in jail."