Billions in assets frozen within minutes, or at most a few hours.
So, what’s the difference between having a bank account where your funds can be frozen and holding blockchain tokens that can be frozen as well?
There are a few important conclusions:
1. Decentralization doesn’t mean ownership.
2. Decentralization of computational resources doesn’t mean decentralization of the assets you own.
3. Ownership isn’t yours (just partially) in either case: neither in TradFi nor in Crypto.
Any custodial system will have this problem. There is no way to get the "Financial Services" conveniences without essentially implementing freezeability by law. You cannot be a lawful money transmitter without said capability.