I was confused by the use of fungibility too. But if bitcoins can be traced they're no longer the same as every other Bitcoin. They're history makes them unique

I was confused by the use of fungibility too. But if bitcoins can be traced they're no longer the same as every other Bitcoin. They're history makes them unique. Therefore they might be valued differently or because workers based on their history. For example, if someone robs a bank and they know the bank knows every serial number of every dollar bill they got then those dollars aren't worth as much as other dollars since there is risk with using them. So those dollars are non fungible with "clean" dollars. You're probably going to want then covered to clean dollars ASAP and it won't be a 1 to 1 exchange. Therefore it's the traceability that makes them non-fungible.