It’s one of those things that makes no sense out of context and perhaps you’ve heard it before. Caterpie was banned from competitive play, back in 2018. Was it secretly Arceus? Alas, no. Nathan P. Gibson explained in a Looper article all about game characters who got banned for one reason or another:
When people think of Pokémon that might be banned from the game they will likely picture powerful Legendaries, all of whom have immense strength and impressive moves. One that would not immediately jump out is Caterpie. This worm-like Pokémon is one of the weakest creatures in the franchise, commonly encountered at low levels in many games in the series. Eventually evolving into Metapod and Butterfree, it is a Pokémon that hardly anyone would choose in battle.
And yet, Caterpie was banned from the official VGC 18 tournament, along with several other unexpected Pokémon. The reason behind this was that certain moves, including Curse and String Shot, could trigger a glitch when used in competitive mode, occasionally freezing the game and forcing the match to restart. Organizers felt this could allow players to effectively restart a battle if they were losing, so they banned Pokémon that could use those moves until the glitch was fixed.
Even though the glitch has since been fixed, you’d never see a Caterpie on the ladder or in tournaments but I’d love to see it again, just to see who remembers and who gets caught out.