Well, until you realize that the merchants affected in this specific incidence, itch.io and steam, have had 12 and 21 years respectively of operation without causing issue for online payment systems, indicating that this is a BS excuse.
This is one of those situations where the optimal level of fraud isn’t zero.
Do the credit card companies go to Wal-Mart, find all the fraud is people buying cigarettes, spirits and razor blades, and tell Wal-Mart to stop stocking those?
Of course they don't.