Crypto privacy goes further than just payments
Solid point. For me, the real win is having that extra layer between who I am and where the money lands, especially on group buys where you don't always know the seller well. I've had decent luck paying with BTC and never had an issue, but I always insist on an escrow service safety net for bigger amounts—not worth the stress otherwise. That said, don't underestimate the litecoin network fees if you're making a bunch of smaller transactions; BTC can eat you alive on that front. Just my two cents.
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Most people think about crypto privacy only in the context of payment anonymity, but the full picture is broader than that. Here is what else matters for protecting your privacy when using crypto for sensitive purchases.
The wallet address trail
Bitcoin and most other coins are pseudonymous, not anonymous. Every transaction is public. If your wallet address is ever linked to your identity — through an exchange withdrawal, a forum post, or a payment to a vendor who later exposes their records — every transaction that wallet ever made becomes visible to anyone who analyzes the chain. This is why the "use a fresh wallet for each sensitive payment" advice exists. A wallet that has only one transaction has no history to trace.
The exchange-to-wallet linkage
When you withdraw from a KYC exchange to your own wallet, the exchange records that withdrawal. The blockchain records the destination. Anyone with subpoena access to the exchange can connect your identity to that wallet address. For higher privacy, convert to Monero before any sensitive payment, or use a P2P purchase that does not involve a KYC exchange at any step.
IP address during transactions
When you broadcast a Bitcoin transaction from your wallet, your IP address is exposed to the Bitcoin nodes that receive it. Full nodes and some specialized analytics services log originating IPs for transactions. Broadcasting through Tor or a VPN masks this. Monero's transaction broadcasting is handled differently and does not expose IP addresses in the same way.
The vendor record
The vendor receives your crypto payment and knows your shipping address. This is the record that matters most operationally. No amount of blockchain privacy eliminates this if the vendor's records are ever compromised or subpoenaed. Use an address that is not your primary residence if this concern is relevant to your situation.