Yes, I read it. Twice actually. It no where say it's an instaban. It just won't allow it to go online with the game if it doesn't have a cert. It however will most likely trigger Nintendo to ban your console future down the line.
"In the digital game case, Nintendo actually
perfectly prevents online piracy here. Tickets cannot be forged, and Nintendo can verify that the device ID in the ticket matches the device ID for the client cert connecting (banning on a mismatch), as well as that the account ID for the ticket matches the Nintendo Account authorizing to log in. Users who pirate games definitionally cannot have well-signed tickets for their consoles, and thus
cannot connect online without getting an immediate ban -- this is exactly how I would have implemented authorization for digital games, if I were them."
And before you refute that it's just for digtial
downloads, it's very likely an immediate ban would happen for physical releases. Since they solved the issue of trading game headers.