[ajkdhcb2]

Seems untrue to me.

Lots of other services continue to function with no such requirements. Bitpay only did it recently after many years of business and there was no regulatory change

I also don't understand how it is logically any different from the merchant accepting btc themselves and choosing to do the conversion themselves

There are many cases where businesses go beyond the legal requirements for whatever reason. Coinbase for example has explained that they make shady backdoor deals with regulators.