I'm not sure how money laundering works, but I think it's a bit more complicated than that. The main point is that there's poor connection between who the buyers and sellers are and who is giving and receiving actual money.
People use real estate for money laundering and that's as traceable. Bitcoins have the advantage that they can be split up easily, merged with legitimate funds, bought and sold through legitimate channels, lent, borrowed, and shorted. This makes it a lot easier to obfuscate where the money came from in the first place.