The problem is that if your address is "sanctioned", then you can change to a new address. It's easy to do because of the anonymity of crypto, and it's hard for others to trace it, you can even change it every transaction.
If want to solve this problem by legal means, then the premise is that you must publish your bitcoin address, but this is simply impossible. Who is so stupid?
The US government's intention was not just for coins to be blocked from the published addresses. It was to get exchange services to block coins
tainted by those addresses. Basically, they want exchange services to do their work for them -- follow the money, confiscate it, then inform them after the fact.
If you want to remove -- or rather, swap -- taint, you need someone else's coins. Changing to new addresses isn't good enough.