In which case, somebody will set up an alternative server which doesn't block them, and people will move there. People who love the free market should _love_ Mastodon.
I expect clients that combine timelines from alt accounts using different servers to become the norm. Users get all the benefits, with more ability to opt out. If I've got Jim@alt.net on banning-instance, and Mike@tim.com on the banned instance, and their timelines are combined client-side, it's the best of both worlds.