Ofcourse, privacy is an essential part of the core principle of Bitcoin because it protects users from abuse (from centralized world) that may be against Bitcoin and the freedom it offers

Also, due to the transparent nature of transactions or activities on the Bitcoin Network and the need to keep users safe when interacting with strangers during transactions, the privacy becomes necessary. For these reasons, peer-to-peer transactions (without intermediary or third party) is required in the Bitcoin whitepaper. So this is basically a direct transaction with your peer, with no one else in between to violate the core Bitcoin principle like privacy.
We could however do things in ways that do not violate the privacy of users if kyc becomes necessary. But that would still involve p2p or decentralized setup.
 The centralized exchanges and platforms are operating outside of the Bitcoin principles hence cannot be considered part of the Bitcoin Network nor seen as the proper way to do Bitcoin transactions (So you have to be careful how you use them). Alot of users simply have little choice since there are very few convenient, Bitcoin-friendly, decentralized local/global ways to exchange Bitcoin.. This is what the Bitcoin/crypto communities are currently trying to fix so that in the end you conveniently transact with peers especially those nearest to you without giving away your privacy.