I don't completely agree, you can move BTC around, mix it and exchange it for other cryptocurrencies while leaving only a very small trail. You don't have to in

I don't completely agree, you can move BTC around, mix it and exchange it for other cryptocurrencies while leaving only a very small trail. You don't have to involve other people directly, you don't have to carry duffel-bags of cash across borders etc... Of course if your money starts in your "books" before being converted into cryptocurrency then yeah, it's useless. But that's not the use case, it's more about laundering money that's not in the books to begin with (corruption, black market, undeclared sales etc...). I believe that right now the main deterrent to this scenario is the same reason people don't use cryptocurrencies for legit use cases: it's wildly unstable and you have to convert it to dollars or some other "fiat" to do anything with it.