No custom ROM on a recent smartphone technically gives you a fully open source Android system when they rely on vendor-provided proprietary blobs in order for basic hardware functionality to work at all. Unless you want to go without a modem, GPS, and likely more depending on your model, at which point it's functionally no longer a smartphone.

Open-source custom ROMs are at least far more open-source than the alternative in most of the ways that matter most, including the ability to change the code in order to remove app installation restrictions, to avoid Google's telemetry, etc.