Huh? Of course it's possible. Making something illegal doesn't mean the state wants to make it go away. In fact I bet they want people breaking laws. That's income to judges, lawyers, cops, court clerk... it's definitely possible. ANYTHING could be made illegal. Including plants.
Possible. But people still can have access to both. Not sure that's the case of X or cash. Can you pay with cash if your country is cashless? Sure, but in very rare cases. Can you use X if it's not in the AppStore? You can, maybe. Bitcoin & Nostr gives you more options and probably will have more network effect if government try to ban it. Because they are way more accessible and independent from central authority.
The paper money doesn't go away manically. People stop accepting it because they don't want to get kidnapped or extorted. You can use X on a web browser through a VPN. If your government banned bitcoin that doesn't mean bitcoin will not exist. It simply means if you use bitcoin within that geographical area you get rekt if caught.
Fear of government and what they may or may not do is ultimately what we’re trying to move away from. Governments are supposed to be elected officials (other human beings) who work for their citizens. Not gods who dictate how those beneath them should live. The few always trying to control the many is the crux of the problem. In other words. Fuck em’!