I'm all for a pure bitcoin (and in my case, monero) standard, setting aside for the moment the fact that neither could scale as they exist today to accomodate for that.

Unfortunately for the moment it's a pipe dream, except in certain small communities around the world, although the situation is improving slowly over time.

Meaning that unfortunately at some level, if one is entirely in crypto, it will be very hard to avoid using some KYC service of some sort.

At which point, I agree, it is essential to safeguard one's own privacy, because to not do so is to put oneself at potential great risk of harm (and also, it's none of their business).

I share your concerns around privacy (and anonymity), there is perhaps an argument to be made over legitimate concerns around source of funds at times, but clearly then ideal equilibrium is not "record every transaction of every amount forever and if any privacy tool was used along the path it must be money laundering", which seems to be the direction we've been heading towards for awhile.

This unfortunate path has been greatly expedited by the normalization of transparency in blockchains, in my opinion. It was already well underway, but a public eternal record of every transaction really sped that along.

Nevertheless, the solution is not only technological. Once upon a time financial privacy was a given, and respected, and it took great effort backed by strong suspicious to break it.

Nowdays it's casually broken pretty much every second of the year. The consequences are dire indeed.

Perhaps one day there will be enough of us spread all over the world, with enough wealth, power and influence, to restore this basic human right to its rightful place.