I think it means no US citizen may use it now but dont quote me on that

Would actually be an interesting lawsuit because how can treasury arbitrarily decide which smart contracts Americans may or may not interact with

The list also tries to restrain every US citizen to prevent them from publishing text (i.e. transactions) that eth wallets interpret as a payment to tornado cash: https://www.coincenter.org/u-s-treasury-sanction-of-privacy-tools-places-sweeping-restrictions-on-all-americans/

People who publish such text anyway (even in a format such as a physical book) are apparently in violation of OFAC and subject to prosecution. But in order to punish them OFAC has to examine the transaction they published (i.e. some text they wrote) and prosecute them for its contents. This is grounds for a lawsuit for violating the first amendment.