It’s not really anonymous.

I can go to a local ATM right now and buy crypto with cash anonymously. I can then pay with it online without having to identify myself. Yes, it is anonymous in this scenario. It depends on how you bought it. But even if you can only buy it through some website that requires ID verification, you can just buy Monero, which has a private transaction history (transactions are mixed together to obfuscate them) and you will be anonymous anyway. In Monero you can have multiple receiving addresses and they can't be tracked back to your wallet. Unfortunately stores that accept Monero are less common, so this can get a bit more tricky.

Now, if 253832893 wallet paid a home mortgage for John Smith with Crypto, then I’d be closer to figure out who owns 253832893 wallet.

Then have a separate wallet for your mortgage payments. But even in your scenario only the bank will know who you are (and maybe the government). Some random store will not know your identity, unless you tell them who you are. Another solution would be to use Monero, which has a private transaction history, so nobody will be able to see what 253832893 wallet has done.

The whole point to Crypto is the block chain and the fact that they are very traceable

Yes, it means you have no privacy, unless you use Monero. In most cryptocurrencies transactions are public, but this doesn't mean you can't be anonymous.

Crypto can be anonymous if you’re smart and you don’t link yourself to your wallet. But once you are linked to a wallet, it is far from anonymous.

You can create an infinite amount of wallets. It costs nothing. It's kinda like the fact that you can use one email account for every website or have separate emails for different things. Or you can use Monero and not need to have so many wallets.

If John Smith wanted to sell me cocaine. Handing him cash is basically untraceable and anonymous. Sending him Crypto ties my wallet to his wallet with a transaction.

People buy/sell illegal drugs on darknet and they use Monero.

But to those people that fill their Crypto wallets with their bank account and just think they are anonymous, they have another thing coming if someone wants to trace them.

You are right about that, unless they buy Monero :). But I don't say that cryptocurrency is anonymous, only that it can be used anonymously. Unlike a credit card for example. It is important to make that distinction though.