The rules in Spain apply for business transactions, i.e.: Business <-> Business and Individual <-> Business, NOT between individuals. The funny thing about it is that in the hypothetical case you would be caught, whichever party reports it first, before getting caught, would not be penalised.

There are different (distinct) laws.

You cannot enter any EU state with more than the equivalent of 10,000 Euro cash unless you declare the amount at the point of entrance.

If border controls finds you with more than 10,000 Euro you will have to pay a fine.

Then you can walk with any amount of money, but when you pay for something there is a limit (500 in Greece, 1,000 in Spain, 5,000 in Italy (was 2,000 in 2022), no limits in Germany, etc.) to any single payment in cash.

And there is usually a provision prohibiting "artificial fractioning" of payment, i.e. in theory if you buy something worth 1,200 and the limit is 1,000 you cannot pay that with two invoices/receipts 600 Euro each.

They are. I could not pay in cash for my lasik surgery some years ago due to this.

I wasn't planning on paying in cash but they dily informed me.

But did you make a single payment with more? I understand that's the limitation

What did you buy for over 1k in cash? I can only imagine a car or bike, but you said walking, so I'm curious...