Every transaction between people is compromised by lack of trust. The Blockchain eliminates the need for trust. It is the trust protocol. The blockchain is a decentralised public ledger with private keys which eliminates the middleman. It is built with encryption in mind. It replaces the need for a trusted third party. For that reason, it is a threat to the traditional government and banking institutions because they have acted as the trusted third party for generations.
The blockchain takes responsibility away from the banks and every organisation which has acted as a go-between when two parties enter into a transactional relationship. Governments are looking at ways to regulate the Blockchain. There are challenges with this. The Blockchain is decentralised. It has no point of vulnerability.