PC Gaming

What’s profitable about losing sales of adult games?

From Visa/MC's PoV the situation looks like this:

1. force itch.io - lose sales associated with that content
2. leave itch.io alone - lose sales associated with anyone who takes Collective Shout's noise seriously, while Collective Shout starts smearing shit on Visa/MC by saying "they finance rape!"

Visa/MC likely determined #2 to be more than #1. In other words it's more profitable to do #1 instead.

Also, what leverage do these groups have over banks and payment processors? [...] I just don’t get it. Some random group in Australia has leverage over Visa and MasterCard - American companies - is that what we’re saying here?

It's mostly their ability to cause brand damage (reasons people avoid your brand because they see it negatively - like #2).

Visa and MC know that, when it comes to sex, people become really irrational. They take insane troll logic seriously, even if they wouldn't otherwise; and those religious groups like Collective Shout are really good at weaponising that irrationality. The way those alt right groups work is that you don't even need to know about the group to repeat their talking points, and spread support to those talking points.

I think you might have too much faith in government.

I don't. I'm picking the lesser of two evils here: a government is less worse than those megacorporations.

But ironically, I think YouTube and many other platforms quietly accept that if we want to live in a somewhat harmonious society, we can’t leave it to the government to make all the rules. (eg. YouTube banning vaccine misinformation and disinformation during a public health emergency.)

They didn't ban vaccine misinformation "because it's misinformation" or "because society would be better without it" (even if both things are true). Truth and morality doesn't matter for those platforms; what matters is brand damage.