One thing you should understand is that making all people pay for the ill intentions and actions of few is usually a bad system design
there are several articles and research online stating how KYC, besides being useless, is costly and adds a lot of friction to businesses
Sites aren't really given a choice in this matter sadly thanks to trash government systems and their excessive regulatory policies which is why they end up enforcing KYC in some form or another to survive basically.
BTC's popularity surge over the years left to world governments trying to take back control in this manner.
If Business can only choose who do we think will love asking their player KYC? specially in crypto gambling that
the business owners knew that people here hates providing their personal details Via Online and will choose not to play when they were being
asked.but they have no choice as Government is asking them to provide this feature and if not complied then their business will be ruined and
faces consequences . you are correct that it is about trash government but also we cannot blame them because our precious place(crypto community)
was being used also by abusers and now being used to launder Money specially gambling section that in the past asking nothing but let you
and withdraw without any question.thanks to launderer now we are suffering from those restrictions and violations.