For the BitCoin currency, the beginning of the end... or just the beginning?

"Senators Charles Schumer and Joe Manchin are pressing officials to take action against Bitcoin... expressed their concerns in a letter to Attorney General Eric Holder and Drug Enforcement Administration chief Michele Leonhart"

As the quote above describes, the news started breaking yesterday that US Congresspeoples have noticed the BitCoin currency. There is some noise about how the government will never be able to truely shut down the the BitCoin currency, I'm no expert to say yay or nay to this. I'm more concerned about something said in the comments of the post above: "Clearly won't be hard to destroy confidence in Bitcoin though, which will have pretty much the same effect." There are two assumptions made in that sentence, 1) If you destroy confidence in BitCoin, you destroy the currency; and 2) It is easy for a government to destroy confidence in the BitCoin currency. The first statement, could not be more true. Trust is the foundation of any currency, currency is afterall worth nothing when no one you know will exchange it for actual goods and services. The second statement, I'm on the fence about.

If the US government were to wage propaganda war on the reputation of BitCoin would they be successful? The effectiveness of such a propaganda campaign may be dramatically different depending on whether or not a government can find a way to manipulate/fuddle with the BitCoin currency. If a government can manipulate the BitCoin currency, whether that be with overbearing regulation or outright electronically attacking the BitCoin network, I have strong hunch that a government could choke the BitCoin currency enough to make the government's own currency an artificially more economical currency to use. Despite the risk of government fuddling, I'm particularly interested in what the outcome of an information war would be on a BitCoin type system that a government cannot manipulate. If the current BitCoin system cannot be touched by a government, could a propaganda campaign be powerful enough to dissuade its use? If so, how would that propaganda campaign look like? Who might be involved? Or, would the truth inevitably bubble to the top as people like me would like to believe is the case on the Internet?