Untraceable anonymous transactions is the minimal requirement for it not to be harmful and dystopian.
No, Zcash offers the option to always use shielded transactions, if that's what you want. The choice to use a shielded or unshielded transaction rests solely in the hands of the user.
It is true that CPU and memory complexity use to be high for shielded transactions. However Sapling just activated (https://z.cash/blog/sapling-activation-complete/) and it resolves the issue: a shielded transaction used to take up to minutes of CPU time and 3GB+ of RAM, but now can be done in 1 second with ~40MB: https://medium.com/@EthAdvisor/everything-you-need-to-know-a...
Furthermore, Zcash promotes the use of TOR if users wish to hide their IP address.
Also, zcash has the trusted setup issue, which requires that you trust the developers were not compromised or did not store data during the setup, or they might be able to print infinite coins without detection if the data were to be recovered. For some, this makes it a non-starter, despite the efficiency of SNARKS over Bulletproofs which Monero now uses.
Don't let that deter you though. Zooko only pays himself a $300,000/mo salary. He will struggle to get by without the crowds of new adopters.
There is no "default" behavior. The software gives you the choice between shielded and unshielded, and the enduser has to choose. There is no default.
«requires that you trust the developers»
Not really. In the latest Powers of Tau ceremony, there were 87 participants. This group spans more than just the developers. Even if 86 participants were malicious or compromised, as long as there is at least 1 honest participant, the system can be trusted.
«Zooko only pays himself a $300,000/mo»
Not sure why this is a problem. By comparison, Satoshi "paid himself" (mined) 1M BTC =~ $6 billion dollars. I'm fine with the founders of world-changing cryptocurrencies being handsomely rewarded.
There is no wait time when recipients accept 0-conf transactions (which is always the case in a brick and mortar store, because 99% of the time it's safe enough – there is even smart tools that verify the transaction is sufficiently broadcasted to reduce risk).
But what if untraceable transactions were limited to small amounts and slow rates, such that you could personally provide for your family but not run an enterprise? (basically that's what physical cash attempts, and as long as the denominations are kept low, it sort of works)
So then you might argue that if it can enable crime, we must do something about it. Admirable ideas, but you then need to ask the question, can we do anything about it? When you ask this, you come to the conclusion that you can't do anything about it. Bitcoin happened. Nobody is in control. It does not care about your opinion.
So the real question we should be asking, is, if Bitcoin can enable crime, and we are unable to prevent the use of Bitcoin, how must our law enforcement adapt to this new world? Then we can stop wasting resources on hopelessly trying to adapt the world to suit law enforcement.
Another problem is that governments which attempt to restrict bitcoin usage will suffer the economic and brain drain which will occur as people move themselves, their businesses and their money overseas to somewhere more friendly to Bitcoin, whose economies will prosper as a result. Also aided by having a stronger monetary base which can't be devalued by central bankers.
Governments don't want to say "we're going to make Bitcoin legal," because they don't yet know how to deal with collecting tax in a world of Bitcoin use. They also don't want to just say "we're going to make it illegal," because they would be doing so at their own peril.
Good luck enforcing any prohbition anyway. We've seen how prohibition of alcohol played out in the 1920s. We also know that many drugs, despite being illegal for many decades, are easily obtainable anywhere there is a demand for them, and largely at the loss of the governments banning them, who could've been collecting taxes all along on drugs sold.
The main reason cannabis is becoming legal in many places now is because it is hugely profitable, and governments want their slice of the pie.
I grew up in Brazil during hyper inflation, and I have Argentinian friends now, so I understand what it means to obtain currency overseas or on a black market, and I can assure you it's a huge hassle and not something people want to do unless their local fiat currency has major problems. If governments with strong currencies start moving against bitcoin, transaction volume will decrease, investors will lose confidence, and the value will crash out. This doesn't require a coordinated effort, it just requires a handful of major countries to start seeing things a certain way.
This was already implemented for hundreds of years. It is called "paying with cash".
Sure, there are some minor edge cases, like dollar serial numbers that are sometimes tracked to catch bank robbers or whatever, but cash is mostly anonymous and untraceable.