I think this is interesting... how would they be able to do so? They can make it "illegal" I guess but there isn't a centralized entity to target. Right?
Also, eventually coins need to turn into real money to pay rent, buy food, pay for electricity. If your bank account is frozen that can be a big inconvenience to doing those things. There would have to be some kind of BitCoin for physical cash exchanges and you'd have to pay everything in cash. Not a very scalable solution for even medium sized operations.