It's a digital thing that can be exchanged for goods and services. Like WoW gold except much harder to obtain.
The point of it is that it is hard to trace to the only goods and services people bother using it for is drugs, guns, assassination, etc. You might as well use regular money if you're doing something legal. I'm guessing your friends aren't scum so are only in it for the money
It's already only used for black market currency. You can't pay your taxes with it so in the end of the day you're going to need to convert it to normal money eventually. There are some businesses that accept it but you're better off with normal money right now. So if they ban any legitimate exchanges of it for goods and services it doesn't matter much since it isn't primarily used for that currently
OK, but say a drug lord gets the bitcoin for his drugs. Does he then sell the bitcoin for real money? And if you can't do that, it becomes useless, even in the black market? Because if you can't buy a mansion or Lamborghini or a yacht with a bitcoin, isn't that the entire reason behind being a drug lord? To make money?
He should convert some bitcoin back into regular money. Too few businesses accept bitcoin so he won't be able to buy anything currently.
Even after it stabilizes the government doesn't accept bitcoin for property taxes, income tax, etc. So you'll still need what the government prints ---