Another quick thought: you generally report capital gains or losses against what you cashed out, not against what you hold at the end of tax season.
So if you were a millionaire in December and a pauper in January, nobody would care because it could still go back up. HODL is not capital risk, it is liquidity risk. Now, if you were to sell despite the plummet because you needed to salvage some spendable money you could recoup some of the loss through a capital loss declaration and get some tax reprieve.
They will get their taxes one way or another. When they create their own gov blockchain to replace the fiat dollar I do not think they will allow other blockchains to run with it . It would be like someone today printing their own paper dollar and being able to exchange it for a us dollar today. I think they will exchange with other countries gov blockchains only.