If Cryptocurrency became illegal overnight, would you still hold onto it? This is a question that I've asked myself before and I'm not so sure that I would. That being because it would be relatively easy for the police to find me and arrest me for not getting rid of my tokens since I have already used KYC exchanges like Coinbase. I'm sure that some people would still be willing to hold onto their crypto even in the event of a crypto prohibition, but hopefully they have a way to circumvent the government taking their stuff. 

Now, I don't think cryptocurrency will ever become illegal in the country I live in, because too many powerful people and companies in my country are invested into the space. Companies like Google and Blackrock along with several massively large companies have poured billions into the industry. Federal institutions like the SEC might seem interested in tearing down the foundations of crypto, but I don't see them as much of a real threat. I think the threat we currently face here is not knowing what is illegal and legal.

Regulation could make some cryptocurrencies illegal, however. We've seen centralized crypto exchanges delist Monero and XRP because the government didn't like them. This might be scary for the space, but it could also mean that less pump and dumps are likely. Some countries have elected to straight out ban cryptocurrencies. The reasons for this vary from crypto being able to free the people from a authoritarian government and thus the government bans it. Crypto might become more enticing to the people than the local government backed currency so it gets banned. Or a government just doesn't like new stuff. 

Now, crypto originally was pretty easy to circumvent the government and thus the law. However, governments have been getting better at tracking crypto transactions as they are public information. The only way to really anonymize a transaction was through a mixer, which just got banned with Tornado Cash. And other supposedly decentralized finance sites started banning accounts that had dealt with Tornado Cash. If Crypto became illegal, I don't think I would HODL. Would you?