Its banned because he's entirely invincible for the duration. You CAN'T stop it at all. Sonic currently has a stage specific stall that can be defeated by a well placed projectile, which is why it isn't banned.
In Melee, Peach has an infinite stall, but due to its nature it was limited to 5 Peach Bombers then she HAD to recover. If she went past 5 she was disqualified. It wasn't able to be beaten either because she could do it where no one would be able to recover from except for her.
This is a character specific stall that is undefeatable, works against all characters, and works on all stages. Since people have already proven that its possible to make it last 8 minutes. It needs to be banned and NO sensible tournament official will leave it legal.
Chaingrabs aren't banned because they're character reliant, often times percentage reliant, and they theoretically can be avoided. If any tournament has a stage list that includes stages with permanent walls they generally used advanced slobs counterpicks. Meaning stage is selected first, then the winner of the last round choses a character followed by the loser. If a stage with a wall is picked, the winner can easily chose a character unable to be chaingrabbed. Chaingrabs also rely on the character getting a grab in the first place. Meta Knights Down-B stall requires damn near nothing to start.
Also, you don't have to do it as fast as you can. Its been discovered that a certain pace can be maintained to keep it working.
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