This is
the reason I barely use exchangers, and if I do, only with small amounts. I don't trust them, and they don't give me a reason to trust them. I can only guess, but it looks like they
want to be in the third category:
I recently came to the conclusion that it's not possible to offer a good, trusted privacy service for a long time:
1. If they're full KYC and honest about it, they can exist but there is no privacy.
2. If they're completely anonymous and don't ask for anything, authorities will eventually shut them down.
3. If they themselves are anonymous but selectively freeze funds (and keep them for themselves), they're kinda untouchable as they won't get big enough to be shut down, governments won't go after them for scamming, and users have no way to get their money back.
All we can do is warn people about #3.
By being #3, they avoid being #2 and governments won't shut them down. They still exist, but they're small enough not to become a target, and the occasional selective scamming makes it worth it for them.
Now the question is, if not using exchangers, what can you use?
Well, one could use a CEX (kraken, binance, coinbase etc). They fall into category #1 which gives them some credibility that if you deposit now, exchange 10 minutes later and withdraw 20 minutes later, it's unlikely they will shut down during these 20 minutes. And if you 're verified they won't cause you any trouble (most likely).
There is also the option of using Bisq, but again the receiving medium must be carefully chosen not to expose you.