Your question boils down to why privacy is important if you aren't doing anything wrong (not-"legit"). I'll only answer in the scope of Bitcoin, but there's a more principled answer to the broader question.
First, the Bitcoin protocol allows any transaction into the blockchain so long as the inputs are properly unlocked and the outputs are validly formed and do not sum to greater than the inputs. A few other rules apply, but basically, any mathematically valid transaction is "legit" vis-a-vis the blockchain.
This definition of legit is quite different from a legal definition. Many mathematically valid transactions are considered illicit by financial and legal authorities.
As a universally open protocol, Bitcoin does not enforce these legal or financial definitions, which vary greatly by jurisdiction. Therefore, there are likely transactions being executed on the Bitcoin blockchain which are illegal in some areas.
Without anonymity, many people would be unable to use Bitcoin due to local laws.
Second, there are social/security problems with having one's full balance and financial history publicly available and tied to one's identity. Bitcoin would be unattractive to most people if it was easily discoverable how much coin you had, a list of anyone who has ever sent to you, and a list of anyone to whom you ever sent money.
Thirdly, anonymity makes Bitcoin more resilient against censorship and state-level attacks. Early on, there were few Bitcoiners. If their identities were publicly known, governments or other groups could have targeted those individuals and de facto shut the project down. Or today, they could compile a list and punish/tax/jail all current holders of bitcoin. Bitcoin is designed as a safe haven against the harms of legacy financial systems: inflation, censorship, taxation, and confiscation.
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