Considering their volume, I find it hard to believe that Valve couldn't find another, more lenient payment processor with similar fees.
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But it is possible that Visa sensibly and correctly said "anyone who makes or purchases such a game is a despicable scumbag, and we shouldn't assume the financial risk of dealing with them."
Or you think one person did that and it made the credit cards decide any story with incest would be the same? That would be ridiculous on their part.