Completely possible. Governments can block as many nodes as possible through IP filtering which wouldn't really work very well. A far more plausible way is for them to restrict its usage by using deep packet inspection to filter out and blackhole packets that either resemble Bitcoin transactions, blocks or anything similar. A mitigation would just be like how we are currently circumventing censorship, VPN or Tor.
Can the government really do that? That is a pretty hardcore stuff trying to filter the IP address. But my question is, isn't VPN still connected to the IP of the country? Which means that it can still be affected by the filter. And not to mention that Tor is really slow and in this fast paced world, I don't think that it can keep up. I might be wrong about the Tor as I am from a currently with a very slow Internet.