Crypto was made to popularize anonymity and ownership of your funds. By sending it to centralized platforms like casinos and also giving them your ID you're breaking 2 things that Satoshi wanted you to have: private money and complete control over your money.
I understand that some of us may be against it.
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The only thing that makes this KYC processes stupid within crypto gambling platform is that most casinos are abusing it. It is also often that they ask KYC even though they do not have any license, there's a point but a lot are doing it just to take advantage of the KYC being imposed.
It also became stupid because the documents gathered using this Know Your Customer process can be used on identity theft and other illegal related schemes. This is the first thing that always comes to my mind when someone mentions KYC, so I wouldn't try to change his mind. I completely agree with OP's statement.