Finally, we can have usernames in Signal instead of giving our phone number to everybody.
Apparently still requires giving Signal your phone number, so not exactly keeping it private.
There’s anonymity and privacy. This keeps you private from other users, and they already keep you private from themselves other than the initial sign up. What this service isn’t, and never has been, is anonymous. They don’t want that and there are big usability issues with an extended anonymous user base. Decide for yourself what you need
Anonymity is part of privacy.
Specifically, anonymity is confidentiality of identity. Confidentiality is part of privacy, which is a broad concept. So when a tool or mechanism works against anonymity, it works against privacy. It may not work against a privacy aspect that you care about, but it’s privacy nonetheless.