The funny part is that Detroit just passed a law that basically bans AirB&B which caused a purge of the AirBnBs entries there
I'm not saying that's not the root cause, just that it seems like a backwards implementation if so.
I think it can make sense from a business standpoint. It is unfortunate it hurts other hosts who have nothing to do with it. But I would guess this is just temporary.
All the law accomplished was sending the sellers underground. Now every time you get a place on AirBnB in NYC you need to interact with a brand new seller account with only a few reviews, and a vague description of where the place is located.