Benefits of bitcoin do not exist under permissioned custodial service. Kyc bitcoin is exactly that.
If it’s all custodial or even majority custodial we will get on-chain censorship, which removes any benefit of sound money. The security of the network requires self custody and the ability for individuals to directly bid on blockspace without kyc entity. 
Trusted 3rd party introduce onchain censorship and self custody is what secures the network. 
Therefore giving users a chance to bid on bitcoin blockspace w/out financial institutional control.
Kyc is that control! 

https://github.com/libbitcoin/libbitcoin-system/wiki/Permissionless-Principle https://image.nostr.build/475a360f4961a0c7920edee2d67ac238803acb804c60d11cbe5c462ff08e2ce1.jpg