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If most of the criminal money is used to transact with other criminals, then most of the money doesn't need to convert to USD.

The real kicker is whether the other criminals are willing to accept bitcoin which they know won't convert to USD.

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Those crime bosses eventually want to buy a new mansion, Porche, a yacht, jewellery/stuff for their wife/gf, you know, anything to actually enjoy their life in real world. They eventually need to exchange their ill-gotten gains for real money. They can't stay in BTC forever. Basically they want to turn the BTC they got from their criminal activities to a clean cash not linked to crime. There are various way they might go about it, basically similar techniques as money launderers use.

You could certainly accept bitcoin for black market transactions and spend bitcoin on black market transactions, but wouldn't most participants want to transport their gains to the real world eventually?

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