If I don't care on spending lots of UTXO in one shot, reusing addresses, mixing coins, coinjoining etc., that doesn't necessarily mean that Bitcoin is bad for criminals. Lots have been caught and it's generally not a good idea if you're going to do something
really bad, but it depends from whom you want to hide. Is it your wife or your employer? They aren't going to find out much if you use Bitcoin. Is it the government? You're screwed.
However, I read that those two kept the private keys of the 119,754 BTC to a cloud server. I highly doubt they were cautious enough. Also, this doesn't make sense:
I think the transaction the Government cannot track in the block-chain technology has not be made.
I don't understand the aspect you translated the meaning of the phrase. But, I think once a transaction gets confirmed on the blockchain, and the ID is available for everyone to access the Government can trace the transaction through some FBI tools. If a fund is not moved they won't be a way for the Government to know that such a huge amount is been disseminated on different wallets such that it can be changed to fiat. I don't think any criminal will ever hodl bitcoin without changing it to fiat. That's what I meant by that.