The owners of localbitcoins do not want to collect KYC. No one really does. In order for them to expand exponentially in the regulated market, they need to conform to the existing banking regulations. Isn't it a shame that bitcoin and the underlining ideology are being forced into the world banking regulations? Sad.
We have seen this before.
Shapeshift: used to be great. They stick to the ethos as long as they could. At one point they "sold" out and started to capitulate to the work banking regs. I can't blame them. They have lives, families to support. If I was in their shoes I would prefer to have a comfortable life than to run from the governing bodies. Edward Snowden and Julian Assange are perfect examples of going against the "man".
Coinpayments.net : Out of the blue, they require KYC. They have also grown to the point of capitulating to regs.
What others have you seen?
I don't blame them for KYCs, in fact I've complied with most websites that require them to at least trade or bypass certain limitations. With cases of stolen funds and hack attempts, they're dealing with large amounts of BTC. Being sued is the last thing they wanna face.
If I'm a victim, I would definitely want the regulators to step in if things go South.