I think this is personally a great idea, Cryptocurrencies for many years have always had some kind of link to illegal activities, doing this will slowly prevent illegal transactions and actually help regain trust in the Crypto world,
Why do you need this "trust" ?
Oh wait, I already know, because you're not interested in what cryptos are but because you care so much about the price, am I guessing right?
Bitcoin already has all the trust it needs, that's why is valued at this ~40k, not because some government says something, bitcoin is valuable exactly because it's your keys your money and nobody can touch it, the moment any cex or so-called de or authority will be able to ban addresses, reverse transactions just because they think something is not right that's the moment crypto will be a failure, it will be just like tradable stocks nothing else.
My question for you guys is where is the decentralization in the crypto space? I keep telling a friend that decentralisation in crypto space won't work out 100% because this will increase the crime rate in crypto space, the law will force those dex to take actions or face the consequences of nailing them for giving criminal a clear passage to accomplish their crime activities.
You can't force a true DEX to do anything!
There is nothing stopping a truly decentralized exchange just like it's impossible for someone to block everyone from saying "hi" to other people, in a true dex there is no central point that can intervene in anything, it's
decentralized! so no administrative authority!