Only the tokens whose smart contract has a freeze/blacklist function can be frozen, in this case that would be the stablecoins USDT and USDC.
Except that plenty of exchanges can also blacklist a wallet, and then block transactions that include funds that (indirectly) come from those blacklisted wallets.
They're just learning the same lessons the rest of the world learned already. Banking and it's attendant regulations and restrictions were put in place for good reasons and everything has a trade off. Being a libertarian is like being a baby.