I would say the OP's claim is worth very little without a source. ChatGPT (obviously not 100% reliable source, but still) says there is no known government that has ever passed legislation saying that you can legally sell crypto into fiat and then restrict how the fiat is used. Money is fungible, that's the whole point.
This July 2025 blog mentions nothing of what the OP states.
The only issue is that often in home buying, countries will have strict AML policies that require the buyer provides proof of the source of funds, even when no financing is involved. If the cash came from a crypto sale, this may require you provide proof of the sale made on an exchange (or OTC) and proof of how the crypto was purchased.
In essence, all the ideals of bitcoin where value can exchange hands without the need for personal information or intermediaries is removed by arbitrary government prying. But what else is new...