The main problem is transparency because you either have a lot of anonymity with little transparency or the other way round. While anonymity is great, transparency is as well because you want to know who you're sending your money to, right? This is a very delicate balance we're talking about here. 0 transparency will attract scammers, 0 anonymity will expose your wallets, potentially get your funds blocked if the government is anti gambling, anti crypto, or both.

Some people will tell you that law abiding people have nothing to fear from KYC, but this is like reverse psychology putting you in a negative light from the start. It's like saying that only people with small dicks wear pants. So now you're either going to admit they're right or expose yourself to prove them wrong. Whatever you do, you lose.