All currency are used in Illegal activities whether it is bitcoin or USD or any other form of money because it is used to buy things so that it used for illegal activities such as gambling, buying drugs and other. As long as it is form of money it can be used into Illegal.
But I have heard that the use of USD is more for the illegal activities because with USD a person is able to pay anywhere in the world and it is know all over the world and the use of it is also very easy than any other currency and a manual transaction is unable to detect.