This is a step backward for those who value privacy and support Satoshi's vision. However, this will not make any sense to market participants, investing in bitcoin only for the purpose of making a profit, increasing their fiat money. What is more sad is that the majority of people investing in bitcoin in the market are people who are only interested in profit. Not many people really need and care about privacy. So don't be surprised to see more and more investors investing in bitcoin through ETFs or more centralized institutions.
Security of their bitcoins, their fund and privacy as well as anonymity are different. They maybe don't care about privacy and anonymity but they must care about security of their fund and their bitcoins.
If they store their bitcoins on centralized exchange, their fund security is unknown and they can not control what is doing by the exchange with their money there. It's not their Bitcoin private key, it's not their bitcoin too.
About investment profit, let's say you only can get profit if you can protect your initial capital and don't lose it. If you store your fund on a centralized exchange that scam, exit and disappear or hack and die after that, your fund is lost and not compensated. In that case, you will not get any profit from your investment even Bitcoin price has grown a lot since your entry.