It will take a hit but certainly won't disappear. Success in Dota 2 nowadays is not based in having fast reaction times and dexterity but in strategic planning and team cohesion. If top teams have a young player, it is usually in position 1 or 2, and many older players are also currently succeeding at those roles.
Besides, this regulation does not appear ban things such as a Dota club at school (online play would be forbidden, but local lobbies would not).
This is the one I'm really curious about. With many esports the competition has been West vs China. Esports are on the rise as well, and now China has crippled their presence in the scene. It'd be akin to restricting athletes to training for only 3 hours before their 18 for the olympics. China's representation in the competitive scene, especially among the new generation, is heavily damaged with this.
Besides, this regulation does not appear ban things such as a Dota club at school (online play would be forbidden, but local lobbies would not).