This has just began on Binance and this is what will be happening on other exchanges.
We can see recently how robbers attacked bitcoin and other crypto users and this is becoming common. These are two recent ones:
Swedish Bitcoiners targeted by armed criminalsBinance Client Executives Kidnapped, Forced to Empty Crypto WalletYou can now trade bitcoin and other crypto with other local traders on Binance and you will meet at a particular place that both of you talked about.
This is just not different from KYC if you trade with bad person. Avoid such physical trading.
If exclude the KYC aspects, this form of trading (physical crypto trading) is used by only naive crypto investors who don't think very well about their physical danger if look into the danger that's associated with it and it's totally different from what crypto presented.