It might even work, if they had a way to track all your cash. Unfortunately, unlike with Bitcoin, they don't. This is pretty much what I said in my original comment?
I don't understand all the apologism, it's pretty clear that governments can exert an unprecedented amount of control on money with Bitcoin (all your transactions are public), and no amount of burying our heads in the sand will change that.
But, they don't have a way to track your bitcoins. They can see how much is in each address, but they do not know whose address it is, etc.
You said the government would need to make all wallets that are not registered with some central authority illegal. That would be the same as you paying someone in cash if cash was made illegal. You would be doing something illegal in both situations. However, what is the government going to do about it if they do not know who you are?
Not to mention that making cash illegal would be a highly political issue and quite unpopular due to concerns with privacy, etc. The same would apply if the government wished to request some centrally controlled management of people's bitcoin account.
Sure, but in the bitcoin case, you'd require both parties' wallets to be unregistered. It would require a legal and an illegal network of wallets (since the government can't track the illegal ones), but whenever a transaction was made where one of the two parties was an illegal wallet, the legal party would be on the hook for it (as it would be transacting with an illegal wallet).
I would recommend to familiarize yourself with how bitcoin works on a technical level before mowing down more strawmen.
Also: Do you really think all countries of the world will agree on one central 'bitcoin address registry'? Contrary to popular belief the internet does not end at Virginia beach...
