Bitcoin is in the "maximising consensus" business.

It's designed so that everyone in the entire world has a uniform view of the blockchain - including in their ability to group outputs by address and tally them. Your view of bitcoin's blockchain isn't skewed or restricted depending on whether you happen to posses a private key or not. On the other hand, your ability to modify it, of course, is, which is why possession of a private key has value.

The reason it's designed this way is due to its archetype - an open, tradable, anonymous asset that being unbacked, places transparency, uniformity and confidence as priorities above all else to maximise value.

You don't do that by burying the blockchain in a thick, syrupy layer of cryptography so opaque that only 1 person in the entire world can view an address balance and the rest have to make do with paultry transaction IDs. Thats an approach who's archetype originates from an online private records archive, or even a transactioning system for "backed" money. In both cases, the asymmetry of verification methods available to the participating parties in the transaction doesn't matter because in the former the sender and "retriever" are the same person and in the latter you have a 3rd party guarantee of endorsement of the address balance.

In an unbacked asset, however, it does matter because choosing and implementing a monetary archetype faithfully is as important as any technological feature - if not more so. You can't have it both ways - i.e. on the one hand claim it’s an anonymous monetary asset and then proceed to implement it as if it were in fact a personal records archive.

Bitcoin is anonymous. Full stop. No personal information is stored on the blockchain and an address balance exists independently of any particular keyholder. The fact that the blockchain contains a visible audit trail is a GOOD thing, not a bad thing. To make the addresses more fungible, the right problem to solve is to improve its resistance to pattern detection, not bulldoze away its universality, or transparency.

I think what happened with Cryptonote is that somebody - Nick Sabernhagen possibly - adapted an old design by creating an implementation for mineable blockchains. But they still stuck with the old banking archetype by retaining the principle of "record keeping privacy". That implementation then got picked up by the Bytecoin people who thought they'd make a fast buck from it through a combination of premine & hype. Then when they were done and had filled their pockets, the Monero people came along on the back of the 2014 "Anon" coin fever and thought they'd have a go.

Except it's still the wrong archetype. An asymmetric, encrypted record keeping technology, closed where it needs to be open, exclusive where it needs to be inclusive and opaque where it needs to be transparent - trying to pass itself off as "fungible money".