Exactly! KYC is the nuclear option for privacy destruction.

Doesn't matter if you're using the most advanced privacy tech - CoinJoins, Lightning, whatever. If you bought that Bitcoin through Coinbase with your driver's license and bank account, the government already knows you have it.

Then every on-chain move gets traced back to your identity. "Oh look, wallet 1A2B3C (owned by John Smith) just sent to this mixer." Game over.

The privacy theater is real. People obsess over technical privacy features while ignoring they doxxed themselves at the exchange. It's like wearing a mask while carrying your ID.