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..that in RL, the government says there are invalid contracts, too. But beyond of these confines, valid contracts are enforceable, and the government exists (in part) to enforce them.

LL simply wants to window-dress SL to make it presentable for its corporate clients.

And so we get the negative aspects of government (arbitrary banning of consensual activity) without the positive (enforcement of valid contracts).

It's obvious that their attorneys wrote this policy. If it were up to attorneys, 90% of commercial activity in the US would cease.

This decision will have far-reaching implications that will on balance be very negative for the future of SL.