Yeah the rules to do it the "right way" officially are absolutely bonkers. There's no way you can spend btc anywhere other than a one-off, and track all this shit. I think there's no shot of anything other than SoV adoption so long as this is the case.

The only possibility I can realistically imagine is that so many important people develop large bags that they pivot tax policy to highly up-regulate sales tax or something. Seems unlikely, but I can't come up with another plausible scenario where you could use it as money.

Well, I guess a broader social collapse is also plausible, but at that point the lack of tax burden will be the least of our concerns.