No doubt about it bitcoin has some negative effects, for example a large amount of bitcoin is being dumped into the black market, because of how bitcoin makes us anonymous and free us from the tracking of the governments some people use this in the wrong way to do illegal things like selling drugs and hacking.
There's no reason why a black market person will convert his bitcoins to fiat. Using fiat will only lead him to getting exposed, it's risky for him. I don't even think that shady businesses are actually using bitcoins because if they do, the price of bitcoin will be much more than what it is right now. I'm talking about some mafia level here, not some lame teenager's "I use the deepweb" type of black market.
Bitcoin's market cap is $20B and the amount of money being transacted in illegal activities surely is much more than that.