Can the government really blacklist bitcoin addresses?

So the Freedom Convoy news kinda dwindled down and I decided to look up how it ended.
Turns out Trudeau got sick of it and ordered police to use gas and arrest everyone aaaand wait for it, blacklist crypto addresses from local exchanges associated with the bitcoin donations.

So the donation address distributed funds to other addresses to the truck drivers in the very emotional and inspirational video and now those addresses are blacklisted from all local exchanges.

Theoretically, a person can just send some/all funds to another address and avoid the blacklisting of that address?

OR, is the whole future chain of transactions are blacklisted?

Early last week, Canada’s federal police ordered all crypto exchanges regulated by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC)—that’s most of them—to halt transactions associated with 34 crypto wallets associated with protesters and funds of $900,000.