Maybe I'm oversimplifying it, but as long as you or I can sell and trade it, regardless of origin, the government should be able to do the same, even if it's money laundering.

Either everyone, or no one, there are no place for exceptions - that is my general rule of thumb.

And I'm for "everyone", because I'm not a fan of regulations et al.

Of course I'd prefer if the money made by this would go into the national budget and would be spent for things that actually benefit people. That way, even whitening money has some justification. Bad money "made into" good stuff.