It seems like they are taking a highly compliant/regulated approach by getting a BitLicense and money transmitter licenses wherever they operate. I've reached out to them for details on KYC/verification requirements and will update the thread when they get back to me.
BitFlyer is really something. If this exchange manages to get all licenses, it does a far better job than all other incompetent exchanges right now functioning as illegal money transmitting service that are on the brink of getting raid. Bitfinex the joke that it is, but still enjoys the status of being the largest USD exchange by volume, didn't want to go through all of this and for that reason has excluded US citizens from their entire operation. I am however not sure how much success this move of BitFlyer will have since they to most people in the western world are still more or less a brand new player, or even unknown. At least I appreciate their effort to become fully compliant, which is something other exchanges should do as well, but don't do because they know they are rubbish.