If authorities know or suspect an address was used to buy drugs, pay a hitman or something, and these coins end up in your hands and you deposit them or pay to someone IRL with them, which then goes into a KYC exchange, then you are now linked to this problem when you don't even know it. If they can reach you they will come asking. I am personally not looking forward to that. It is not magical if it has real consequences.
Do you check the serial numbers of your bank notes for known crimes in the past before accepting them? I've said it before and I'll say it again: attacking Bitcoin's fungibility is the only way to attack Bitcoin. They can't shut it down, they can't stop it, they can't ban it, but they can make people believe they shouldn't accept it because
certain coins might be
bad!
If someone gives you $100 in dollar bills and you try to deposit at a bank, then if the serial number of the bills is flagged by the authorities, you will have the exact same issue. I am just saying this because it looks like everyone who uses the "tainted" coins arguments seem to forget it.
If this happens to banknotes, it's not to blame you, it's meant to catch a bad guy. There's a famous case in the Netherlands, where a murderer
was caught when he started spending banknotes of the ransom he received, of which the numbers had been recorded.
Karma eventually caught up with the murderer, when he was ran over by an excavator.Catching murderers is a good thing! But with banknotes, it doesn't make people afraid to accept them, just like people shouldn't have to fear that certain Bitcoins are "different" than others.