In a classic article on the problems governments can be expected to face with Bitcoin adoption, Daniel Krawisz writes:
All organizations tend to evolve so as to resist change, but governments, being subject to the problems of socialism, suffer much worse from this because government operations lack a clear concept of efficiency [for] their overall success, the relative importance of any of its parts, or the relative merits of alternative organizational structuring. Consequently, governments can more easily evolve into labyrinthian structures that nobody understands without anyone realizing what is happening.
An eye-opening article called Sinkhole of Bureaucracy describes a surreal example of this phenomenon in an outstandingly incisive way. In an abandoned Pennsylvania mine, which is now an office containing 600 federal employees and endless filing cabinets, process all the federal retirement pensions on paper by hand. The system is widely understood to be insane and dysfunctional, but despite repeated and ceaseless attempts to automate the process beginning in the early 80’s, the system has not changed. It is not a problem of will, but of knowledge: there is no one available with the skills to carry through the transition successfully, no one who knows precisely what those skills would be, and no one who can evaluate anyone else for them. As a result, the attempts to develop an automated process failed because the software engineers did not understand the laws and the bureaucracy well enough to design something correctly, and the bureaucrats did not know how to tell if the software engineers knew what they were doing.
Will the federal government be able to adapt to Bitcoin? This would require building an a system not just for the one department, but for the entire organization, and it would have to be built properly — it must distribute decisions enough so that bitcoins cannot be stolen easily by employees. After reading that article, I think it is reasonable to think that the government may not be up to such a task at all.