A government could easily mandate block lists. All legitimate businesses dealing with cryptocurrencies would be required to not consider "blocked" coins as valid. I can even realistically envision broad support for such a change, when some "character" who is sufficiently evil becomes known (via non-stop media targeting I suspect) to be empowered by a certain cryptocurrency.
I suppose there are some blockchains where it is not possible to follow balances between transactions. I'm not sure what would happen with those.
