It is a comparison of how valuable data is as new gold and oil. And that explains what you have explained, millions of people who have complied with it and knowing that it's been leaked and got into the hands of unknown, they can market it and up for sale in the illegal marketplaces. Then, that comes next with what you have said about doing such attacks to the victims. It's a variety of issue that lies within the kyc and every single person who's got their data in the wrong people can simply lead to many dangerous acts that can be done to them directly or indirectly.
I repeat again you can't talk in generals like that like data is valuable. Most data has very low value, don't just say what you read on news websites and then repeat it here. I read that data is the new gold and oil too in the past, but it has no relevance to this topic. Personal data is very cheap because it is leaking all the time from many platforms. There is only one point of the data that can be considered important here and that is the relation to the crypto holdings, even that data you can't really call valuable because it does not have a high market value. The value comes from the knowledge that you can attack this kind of person, not from a direct kind of market value so it is much more abstract. We don't have a way to even put that in a real number.
Kyc documents are also very important for recovering a user's account if it is hacked because there may be enough funds there so it is their responsibility to transfer the account to a legitimate owner.
This is not true at all, in most cases of hacks the money is gone. Having KYC does not help get you the money back, it is not possible to get it back this way. Don't give benefits to KYC that are not there, it would be better if exchanges operated without any KYC.
