Sponsorships are the primary way YouTube creators make money. There aren't many things that could knock YouTube off its near-monopoly market position, but banning sponsorships is definitely one. Creators would revolt.

They pretty surely would not.

Creators are already starting to build their own platforms for hosting videos and many of these are quite successful unlike prior iterations from 10 years ago.

Do you have some examples? I am still a bit sore from my adventures as a creator on Viddler and Dailymotion.

I would point to platforms like Curiosity Stream and Nebula, which are creator driven. Though I would not exactly call them Youtube replacements, as they are more just platforms designed for supporting specific creators more directly (akin to Patreon). These platforms are often advertised as in-video sponsorships, so going back to the original point, I do think creators would be very vocal if such ads were banned.

Kick is one that's been poaching big names lately. I've also seen people starting to stream on X and Rumble.

They wouldn't have a choice, your average big youtube channel earns 95% of their revenue from sponsorship.

It would either be trying a revolt or stop youtube.

Why would they not allow them?