They key is, the payment processor would not know, because they should not have the ability to ask. What's needed here, is a replacement for cash. Nothing more, nothing less. The digital dollar wallet, with a number and a passcode that only you have. And you can send that to another wallet number. That is the scope, and the complete scope. Bitcoin w/o the blockchain. This should be provided by a government, not a bank or a payment processor, and should be free - systems paid for by how we pay to mint physical money.

Fun story about the electronic toll pass, which I refuse to use and as a result get to places slower by never taking a toll road, in over 20 years.

We had tolls. You throw a couple of quarters in, and you go on your way. They were replaced by the electronic toll tag. Which is linked to your name, your credit card, and keeps a timestamped transaction history, forever.

There was a custody battle, and the divorced husband got the kids. The court looked at the wife's toll records, showing she comes home from work real late, and that would impact the quality of life for kids. Boy, I bet she never thought she'd lose her kids by using a toll tag. I bet she did think after the divorce she'd have to start coming home earlier and probably set it up with her manager. We'll never know.

Thing is, it should have been an anonymous electronic RFID wallet you reload, to replace the function of the quarter coin, and it became a government tracking device attached to your car.

Now answer me this: is your ISP responsible for you downloading that torrent full of child porn? Well, that's probably a bad example. Is Cisco, the maker of the network switch that ISP uses, legally responsible for it?