>Assume the buyer/seller holds capital from sources that the majority of the market considers “illicit” and/or is legally sanctioned and/or physically frozen or restricted
This is not feasible legally, and is where your claim falls apart.
From the now-passed GENIUS act [0] which regulates the stablecoin issuer:
- "Permitted payment stablecoin issuers must maintain reserves backing outstanding payment stablecoins on at least a one-to-one basis, consisting only of certain specified assets, including US dollars and short-term Treasuries."
[0]: https://www.lw.com/en/insights/the-genius-act-of-2025-stable...