Counter Strike has weekly drops, you get a case and some random skin. Usually those are not worth much themselves, except maybe for the case. People then sell these weekly drops on the community market and get Steam balance. Sell enough to afford a key (+case).

In other cases kids might have access to their parents payment methods, or they can buy prepaid cards from places like gas stations. I used to do this to buy games when I was younger and my parents wouldn't buy games for me.

Valve doesn't prevent anyone from opening cases. There is no KYC.