Open source can make it easier to audit software, but we're long past the point where we can't audit unfree and/or closed source software. Open source is great and important, but the debate around open source regarding trust and security is often a sideshow.
If 1. all participating devices are sufficiently secure and will be sufficiently secure in the future, 2. no participating device backs up your conversations to the cloud or only does so in a sufficiently encrypted manner, and 3. no participating user leaks your information in any other way, then yes, the general expectation is that your WhatsApp chats with people are encrypted. Keep in mind that defaults, nudges, and people work against you in this long list of requirements.
Oh, and... more importantly... metadata. But that's a separate issue. WhatsApp's encryption claim could be entirely true, but still work against user privacy, simply because those conditions are almost never true ...and also, again, meta data.
Users conscientious enough to consistently meet all of these requirements could simply use a platform deemed less hostile to user privacy, such as Matrix or Signal.
In the video, it sounds like the account will still be associated with a phone number, but users will be able to hide the number on Signal itself. Essentially creating a second on-platform identifier.
This would solve the expected spam problem that would occur if the phone number requirement were removed, and might protect against stalkers et al, but intuitively I'd say you could probably require Signal to reveal the phone number associated with a username. So it's probably not a step towards anonymity.
... anyway: super exciting and very welcome. Hopefully they will finally ship it. .... after hinting at it for several years.