No, that's not why. Some companies just do this for every engineering hire, even those being hired for senior or specialized roles. I came in to my current job with two and a half decades of experience across multiple specialties, nearly a decade on a project they relied on and for which I was an upstream maintainer ... and I still got the whiteboard. Maybe there are some exceptions, but I have yet to meet one. Even characterizing it as an "entry level assessment" already misses the mark. It's more about avoiding bias (or the appearance of it) by trying to apply a uniform process and standard across the board.

Some might say you shouldn't want to work at those companies if you don't like their hiring process, as though there's nothing to any company but the hiring process. It's like saying you shouldn't join the military if you don't like basic training. Nobody likes basic training. People join organizations despite those things, and I for one am not going to judge them or assume their reasons are silly just because I might decide differently.