It's obviously not as simple as you conjecture. For the simple reason that the blockchain is simply a record of transactions on anonymous public keys. Generating a new private-public key pair can be done trivially and secretly.
Everyday thousands of illicit transactions are carried out on the blockchain. The US government has never shown a shortage of force when it comes to stopping drug dealers. Yet the number of people who've been arrested based on blockchain analysis can be counted on one hand.
