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I appreciate you hitting many of the points I wanted to make. Now I can just add in some extra comments.
What will be the role of government then; since there would be no taxes, because all transactions will be encrypted and anonymous.
This subservient attitude has no place in a free society. It is not our responsibility to make it easy for the state to expropriate us. That's their problem, so let them worry about it.
Would it not lead to more corporate crony capitalistic bullshit, since the idea of welfare state would fall apart.
I don't see the connection between these two things. Crony activity is primarily related to Cantillon Effects and restricting the entry of competitors. Bitcoin immediately ends Cantillon Effects from money printing (technically, miners get the benefits from Cantillon Effects, I guess). Restricting entry has nothing to do with Bitcoin and I assume it would continue as long as there is a political system to lobby.
The existence of a welfare state, in nations with representative governments, implies that people in those societies value helping the poor. Absent the state welfare system, we would have private charity.