Our current money system is based around both hard cash and accounts in banks and credit card companies. Since there is more than one of everything in this system, "following the money" always involves multiple actors. Even government level actors with legitimate interests have to go to each individual stakeholder to get a full picture. This is exacerbated when it involved international transactions, which makes international settlement systems like SWIFT a juicy target for intelligence services.
Blockchain, or any other system that uses a "distributed ledger", is a centralized system by design: All transactions are processed over that ledger/blockchain, so they are known for everyone. Every transaction in history is stored there.
Of course you could claim that the individual wallet on a blockchain is anonymous, but once it leaks it's done: Every past transaction is then public knowledge. These systems have no "forward anonymity" or "forward secrecy" built into them. For example, let's say the NSA has a backdoor to Amazon or Netflix: they suddenly know who a lot of wallets belong to.
In severe cases there is enough circumstantial evidence to trace accounts. An example for this
can be seen here.
The solution to these problems are flange-mounted onto the existing blockchain, and personally I wouldn't trust them too much. Monero with it's "ring signatures" has basically the same set of problems the Tor network has: provide secrecy and anonymity over a public network. Any sufficiently equipped attacker can and will analyze the traffic, and government level agencies will not publicize any weakness they have found.
I think you miss the basic tenet of the crypto currency boom: speculation, hype and a distrust of the existing fiat money system--in basically that order.
You can already build a cash like society with GNU Taler, but there is no hype around it precisely because it doesn't lend itself to speculation: There is no advantage to have your savings lying around in the form of Taler tokens instead of your bank account, as there is no exchange rate. Once you realize this has been one of the main drivers of the crypto currency boom, the rose-tinted glasses should fall off by themselves.
Let's circle back to a real life example: How does your child get money from the Tooth Fairy? "Just leave your smartphone under your pillow next to your tooth, and the Tooth Fairy will make a transaction to your crypto wallet. No, it's a coincidence that the wallet ID the Tooth Fairy uses is the same that sends you your pocket money!"
