Is it possible for a UTXO currency to be fungible?

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Kaspa is as fungible but with one big advantage: because of its high throughput and high block rate it's cheap and fast to use mixers to de-colour your coins. But AFAIK no one has picked up the glove and created a Kaspa mixer yet.

Yes, Kaspa is designed to be a fungible currency. Its UTXO model includes features such as confidential transactions and Dandelion++ for transaction obfuscation, as well as a dynamic block size limit to help ensure scalability and low transaction fees. These features make it difficult to trace and link individual transactions, which helps to maintain the fungibility of the currency.