A very good question I would also like to know the answer to. They claim it is for regulatory reasons, but one never truly knows with these types of corps, especially when their requirements seem much more than over institutions I've interacted with :/

I doubt that KYC has anything to do with a desire to prevent money laundering. The bankers and their government puppets are all money launderers. I see a lot of these sites and they have different levels of KYC, some having none if your transactions are less than x dollars (as much as 1000). Their KYC varies in onerousness too.

Unfortunately the vast majority just go along with it, so it looks like it is here to stay. We can just support the ones who don't do it and ignore the compliant ones. What we each of us do is what matters, what others do it not our responsibility.