alt Hacker NewsFungibility and traceability are orthogonal. Equities markets transactions are highly traceable and also highly fungible.
Bitcoin's fungibility is limited by its incredibly slow transaction speed. (This is true of all cryptocurrencies AFAIK -- even the fastest ones that are only capable of 100K TPS at best.)
Equities markets don't have to deal with "tainted" transactions, because every transaction is like a government-approved deed or title transfer.
Bitcoin's transaction rate is artificially limited.