Even if bitcoin goes entirely underground that doesn’t mean it will necessarily be insignificant or “niche.” Internet piracy is black market but not remotely niche—P2P is 98% illegal copyright infringement but it takes up about a quarter of internet bandwidth.
I could see bitcoin thriving in an entirely illegal capacity, being as widely used among some groups as P2P filesharing. Once upon a time people thought filesharing would become insignificant and restricted to a small community of tech-savvy individuals if they just took down Napster and Limewire. But as far as I can tell, illegal filesharing is as pervasive as ever.
Even if bitcoin goes entirely underground that doesn’t mean it will necessarily be insignificant or “niche.” Internet piracy is black market but not remotely niche—P2P is 98% illegal copyright infringement but it takes up about a quarter of internet bandwidth.
I could see bitcoin thriving in an entirely illegal capacity, being as widely used among some groups as P2P filesharing. Once upon a time people thought filesharing would become insignificant and restricted to a small community of tech-savvy individuals if they just took down Napster and Limewire. But as far as I can tell, illegal filesharing is as pervasive as ever.
They are already used in such capacity in the black markets over the Tor network.