Not necessarily, in my opinion KYC sometimes helps to remove a large number of multi-accounts, the main thing is that the project is not fraudulent!
Are you trying to say that when a project requires a kyc then it's not a fraud? Perhaps, it isn't as this is actually just a show up so they won't look shady and shill. And the worst case that may happen is they are scammers and your documents will be sell to black market, hence that's a fact.