An order of magnitude of more drugs are sold on Cash App and Venmo -- which is why they're in rap songs. As for large scale hacking, extortion and ransom, yes bitcoin is used but it is increasing difficult to cash out in a large way.
But its not? You can convert 50 million usd worth of bitcoin in one order without moving the market more than 1-1.5% and have a wire transfer to your bank account same day. This happens all day every day, with the markets getting deeper year by year.
Trash exchanges for retail have nothing to do with the infrastructure actually out there. If you are moving anything over 4 figures you shouldn't be trying to use retail exchanges. They're trash, slower, randomly flag stuff, and have higher fees.
its been like this for half of bitcoin's existence
they consider themselves distinct from exchanges because they do not take custody of people's funds, in their opinion
Almost all illegal bitcoin stolen by hackers and ransomware is cashed out in countries with limited or no AML/KYC.
It is actually difficult to cash out?
Unless you're best friends with an oligarch, and if that's the case, you can always get Deutsche Bank to do it for you.