A country's legislators can ban whatever it wants. Lawmakers hold the keys to the kingdom, so to speak. So if they want to ban cryptocurrency, toilet paper, bacon bits, plastic products, or umbrellas, it's well within their authority to do so. However, as kings of long ago discovered, there are social repercussions to certain legal actions. They might ban cryptocurrencies, but citizens can always circumvent the laws as long as they are willing to take the risks associated with doing so. For many people living under oppressive regimes, it's a risk worth taking. In some countries, the economy is so bad that cryptocurrencies are their only hope. 

Long story short, yes, countries can ban cryptocurrencies, but it isn't necessarily wise to do so.