The solution is not cash, it is regulators who will kick the door in when you’ve suffered injury in the course of using financial infrastructure or services.
The consequence of abolishing cash seems to be total financial control and that is a bit like arming the police: of course you might need military equipment for fighting a cartel.
But applying it to daily operation is very cruel to parts of society.
There needs to be a statuary right to be serviced by the banking system. This is in addition to escape valves such as cash and crypto.
This would ensure everyone had access to direct-deposit payment (eliminating most of the case behind the "it's almost a real bank account" prepaid-card products with exploitative fees) and create a single huge audience to target for "over the top" services to develop.
Perhaps it could be put together as a "portable" service-- you can link your state-bank account with your preferred brick-and-mortar to handle cash and in-person services. There would be phone-number style portability, to encourage them to compete for most features/lowest fee/subsidy requirements.
People problems demand people solutions. I know, it’s a bummer. No tech saved Kansas abortion rights earlier this week. Overwhelming constituent turnout to vote did (voter registration is up 1000% in Kansas). (Used only as an example for my thesis)
You are making the perfect the enemy of the good. This is not about fixing everything all the time. This is about giving individuals in general leverage against their institutions. The goal is to put systems in place that make the individual battles (for liberty, equality, and the pursuit of happiness) easier.
I think your failure to identify the nature of this situation is emblematic of a failure of common liberal/leftist thought.
P.S. We still live in a time of great prosperity and freedom. That's largely due to technological progress. Technology can be the difference between feasible and impossible regulation. Technology changes the very landscape on which the political battles occur. To ignore the influence of technology on politics is to go into battle blindfolded.
Institution1 holds regulatory powers, and institution2 is the guard/police for institution1. Then another institution3 guards institution2, and institution1 also has a responsibility to oversea institution3.
This system does not work. We need something better
Yeah, all systems are fallible. But systems that fail on the side of the individual are preferable to those that fail on the side of the institution. So let's strive for individual liberty instead of wishing for benevolent rulers.
A world where you can ensure your privacy in both cash and digital payments would be better simply because if the government takes one of them away you still have the other. So instead, we argue for worse is better. Only cash is allowed to be anonymous, only cash is supposed to protect your privacy, only cash does bla bla bla, people are following the letter of their ideology, not it's spirit.