Regardless of exactly how the Coinbase transaction was initiated and cancelled, the OP's issue is with US regulation, not Coinbase's business practices.
Money services businesses have to obey aggressive KYC and AML processes or face the possibility of huge fines or getting shut down.
I would like to see a modicum of evidence that suggests this has anything to do with KYC/AML restrictions. I have seen none to date.
Coinbase is shady as hell. Don't use them.
Exactly. They canceled my order that was placed on 10/31, yet whitelisted
future orders without any additional identity verification from me. There is no way that had anything to do with KYC/AML. If it was KYC/AML, there would have been no need to cancel the order. The order shouldn't have even been allowed in the first place. Instead, they decided to take my money, keep it for over a week, and then return it after a huge bubble in the price of Bitcoin even after I told them that my preference was to process the order. I cannot imagine a legitimate KYC/AML reason for that behavior, but it's easy to imagine why they had a business interest in canceling my order.