Interesting to read everything here!
Not everyone knows that the guests are given two choices: 1. Go per the Hos'ts cancellation policy, and 2. Take the travel credit being issued for the total reservation costs. If the guest selects option 1, the hosts are given 25% of the payout - because they know Airbnb is bread and butter for some hosts. This is applicable for the reservation CHECKINS between March 14 and May 31. And the guests get what they have paid so far on the booking.
If they select option 2, which they never won't because - money!!!! They loose too. And as a host, you get some payout too in this choice.
If the host cancels the reservations themselves, they are penalized monetarily and calendars are blocked for the period of the booking.
So go be a considerate host and accept that request if the guest sends it over to you, or you have them pending, because you have only 48 hours to accept them. Your choice - 25% or none.
P.S.: the 25% is paid by Airbnb from their own pocket and not funded from anywhere.