However, many people do not like KYC because they are concerned about the issue of personal information being exposed. Information used for KYC such as passports and driver's licenses may be exposed if the exchanges are not well secured.
Yes there is possibility that information disclosed can be sold out to someone else or used for illegal transactions. Not only in exchanges, bounty companies sometimes require KYC after you have participated to help them but after you submit your documents and passport they may not fulfill the release of reward and you end up regretting it. KYC is not suppose to be introduced in an online transaction because privacy should be protected.