Like any tool, it's bad when used improperly. Shadowbanning should be used to waste trolls' time; it's especially effective for cheaters in MMOs (lump the cheaters together so they don't bother anyone). Shadowbanning shouldn't be used to control the discussion, like silencing an unpopular or undesirable (to the platform) individual.
I think we're doing too much of the latter, but that doesn't mean shadowbanning as a tool is morally bankrupt.