This does not make much sense. A 10% fee is acceptable if the alternative is significantly lowered sales (50% +) due to increased friction in the money transactions..

So if they are not declining on ethical grounds, and the merchant will definitely pay up the 10% processing fees, why are VISA and MC not offering the option?

I doubt it's ethics, but could payment processors be feeling pressure from political entities who are threatening policy action under the guise of ethics and morality? With the current administration, groups like this would have no trouble finding political backing.

That's a common narrative but how do you explain Steam?