It is not as if casinos right now have too much of an option, years ago it was common for many trusted casinos to not ask for KYC, unless there was some suspicious activity or you got a big win.
But governments fearing the popularity of the market of cryptocurrencies as a whole, and taking into account the rising popularity of casinos since the pandemic began, have taken the decision to be more forceful with businesses like CEXs and casinos, so now if you are not willing to identify yourself, you cannot really make use of those services anymore.
there is a gap left by casinos in the past that did not require KYC. and it is exploited by people today to carry out criminal acts such as money laundering.
Of course, it is also uncomfortable for the casino when their platform is used to commit crimes and if it is publicized by the government that handles certain cases, it could be bad for the casino's name.
So both casinos and the government ultimately have to make KYC a way to prevent bad things. KYC is not just about trust labels.