It's not, though. The project got sanctioned and by extension the services it provides. The blockchain implementation of said service is rather unique, but I don't think this is technically any different from projects like Popcorn time being sued/shut down despite their p2p systems.
The difficulty with smart contracts is that it's hard to take those services down. After all, you can't take a smart contract out of ethereum. The legal ramifications of this are interesting: the undeletable nature of blockchains and their capacity to store arbitrary data or execute arbitrary code could taint the entire blockchain when bad actors unleash services that cannot possible be taken down, causing anyone participating in the blockchain system to be an accomplice. Or perhaps the governments of the world will look at this more pragmatically and simply consider the contract dead, only sanctioning new people who call upon the contract to execute transactions.
This indestructibility of the blockchain is often sold as a benefit, a way to stick it to the government, but the real world doesn't care about your technical implementations when the police tells you to shut it down. Designing a system that you cannot control or shut down may not be a great idea, especially if interactions with said system are logged permanently and publicly.