If this is really enforced, it should lead to a huge devaluation of crypto currencies. After all, the reason why Bitcoin was invented in the first place was to decentralize currencies. Moreover, most crypto wallets should still be offline so a lot of value will be lost of no loopholes can be found.

A crypto currency forced to be managed by centralized authorities is pretty much useless, the equivalent of having a savings bank account in some extremely volatile foreign currency.

I suppose there will be enough loopholes in foreign countries to prevent these negative effects in the short term.