Decentralized casinos are not casinos serious gambler consider at the moment, and again, though decentralized casino are kyc free, it still have its own cons, and one or two of those is In the area of
1. Security
2. Trust

I am not going to talk about security, but lets touch a little on trust, like I said in a previous comment on another thread, how much can you trust a smart contract that is not open source and also not audited by any audit company?

It is very possible that a decentralized casino could have some malicious code written into the smart contract by the owners, this will cause majority of the players to lose their money to the casino, and allow only a very minimal number of persons to win from time to time, so that others that are losing will just think and conclude maybe they aren't lucky enough, and would keep trying.

This another issue to put into consideration when it comes to decentralized casinos.

When I first saw the complaint from OP with no evidence and proof of payment to profile wallet to back up his or her claims, I just had the thought maybe one of those regular paid  random guys to do a dirty job on the casino I guessed. 

It was obviously clear from the terms and conditions together with withdrawal policy that KYC was required and that they have every right to demand for KYC when the need arises but OP failed to read through all these before making deposit if truly it happened as claimed by OP that the casino is holding unto his or her funds and demanding for KYC.

but there are possibilities that they have a banner with big letters written that no KYC is required then at the bottom there is a small letter that states upon signing up this is mostly what I noticed on advertisements or promotions to attract new customers, others will say that no KYC but terms will apply so still there are KYC upon withdrawal but I don't see also any proof from OP so possibly dirty tactics from opposing casino to just give them a bad review or etc.

What was the latest update of this topic? does the OP managed to submit his KYC or did he get his winnings? All gambling site have a reason why they should hold or confiscate the winnings and if they don't give a valid reason then they just destroy their reputation.

There's no reputable decentralized casino aka web 3.0 which doesn't ask KYC, you can check on their terms of service where the casino will still ask your KYC whenever they want.

That's why if you want to connect your wallet to the web 3.0 casino, make sure you're using your secondary wallet where it's only contain the coins you can afford to lose. You can also use a different device if you're worried the web 3.0 might spread a malware that can infect your device.

You're saying like the casino is manipulating the result, you should gamble on a casino with provably fair system.

One thing I normally do before I get registered on platforms is to take out time to read through the terms and conditions applied irrespective of the give away bonuses or anything else to hold onto for more clarification. Most times these bonuses are just to get at unsuspecting participants to get registered and once they do, boom ! They are back to their initial plans of ripping out people through their cons.  OP should have read through the terms and conditions before jumping in and making deposit. These are the Minor mistakes made in respect to getting onboard a platform as a result of bonuses and give away without reading through to know the clause involved in the give away and bonuses.

Web 3.0 casinos, otherwise called decentralized casinos are of two types mate, there are some casinos that claim to be web 3.0 casinos, and even offer user the ability to connect their wallet, but when you take a proper look into the casino style of operation, you will discover that the casinos is just a partial web 3.0 casino, not fully web 3.0, example is owl.games which I believe we all know, owl.games is a partial decentralized casino, that is part decentralized and part centralized.

A complete decentralized casino should have absolutely nothing to do with kyc, its the same as uniswap and pancakeswap, this are exchanges that have nothing to do with kyc, simply because, they are completely decentralized.

   -   The question here is about your issue mate, did you read their terms of condition and rules carefully? maybe because later on you didn't read and understand it well. Because there are other casinos that actually say that there is no kyc but once you reach the amount of their withdrawal limit that exceeds the limits, they have KYC requirements.

Also, when you say your balance has been confiscated on their casino platform, do you mean your account has been locked or banned on their platform? Because then, it can be said that they scammed your money without notice.

That's exactly what everyone should do if they really care about their money and don't want to give up on them. We all understand that if a casino advertises something but doesn't follow it, it's their fault, but can we actually do even if it's their mistake? We can do nothing except making complains or creating accusations against them.

So the only and the best solution to not getting into such issues is simply to read the terms and conditions of a casino right at the time of registration or just before you are about to make a deposit with them to gamble.