I don’t think that’s true in this case. I would assume the bank issuing the coin has to know the identity of the people they sell it to. But once those people sell it on, it’s not their problem any more. Sure they could get an order to seize those coins (/wallet) and would have to obey. But I don’t think they’d be required to kyc everyone on the network. Just their immediate counterparties…
The idea is (as I understand it) that to get fiat (which is presumably the end-goal) you need KYC, so if each node which converts stablecoin-fiat then you have acceptable KYC. (I am not a regulator though, so who knows?)