I know, its my mistake. I should not have used a VPN to bypass the rules. (I now live in a restricted region)
Does this mean that Shuffle.com can now withhold my funds indefinitely?
It is good that you admit your mistake. Unfortunately, there is nothing you can do at this moment. The casino has the full right to close your account and seize your funds if they want. You accepted their terms and conditions upon signing up. So, even if you file a legal case against them, that is not going to work.
I will also suggest the same thing. Forget about your shuffle account and play in a casino where they accept players from where you are living in at this moment and also, before you sign up, contact their support and ask if everything is fine.