That's the theory. He was talking about the real world, where even using a decentralized system can get you busted in the real life by centralized organizations and govs. For them, that doesn't matter. If you receive illegal coins, you may end up in jail. Bitcoin being a permissionless network or not.
If a person is commiting a crime, then there is a high possibility for him to end up in jail. Thats for sure. The bitcoin network doesn't give you a right to act illegally, it merely doesn't care in case you do so. But that doesn't make the network itself illegal and transacted bitcoin nonfungible. Each bitcoin that was tainted by authorities still has its credible monetary properties and can be transferred and exchanged to another bitcoin. This is a fungibility secured by consensus rules of the network, no matter what other organizations say.