According to the Internet Archive these new terms have been implemented less than a month ago. I feared this day would eventually come. Recently they seem to have an increased focus on the licensed KYC casinos that under their ownership. Their XFUN wallet also has KYC features which I found odd since it's purpose is to support their decentralized gaming token. Any time they've promoted anything having to do with their FUN token they've emphasized the decentralized aspect but that doesn't really align with the measures they've been taking.
Op's screenshot shows T&C popup available on signup procsess, can someone provide a link to T&C in logging in state? I'm an old user and my bad I never found the T&C page as far as I searched on some of the freebitco pages.
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Perhaps, they have registered a licence under Curacao (I'm not sure about this yet).
Freebitco also restricts curacao users, I think there is no way a company registered in country X will restrict users from the same base. cmiiw
Setting up a BV, privately held company, is a requirement for acquiring a Curacao license so they are either already licensed or in the process of getting licensed. Once you are a licensee you are not allowed to accept citizens from Curacao.