When adding an auditing or waitlisted student to a Canvas course site, it is recommended to use the main Student role.
The Participant role option in Canvas is based on the TA role, and wasn't designed for use with students, regardless of their registration status. While an individual with the Participant role cannot access grades, that role is synced with external tools like Gradescope, and the Canvas base permissions for Participant or TA are assigned to them. When that happens, those individuals can then see grades, and other data that should only be exposed to a GSI/TA for the course.
Refer to the list of all Canvas roles for additional information.