Blockchain currency definitely isn't the solution if the problem is tracking or avoiding confiscation. 1) the blockchain is a permanent immutable log. Once you do tie and identity to an address every transaction ever is immediately available. 2) the key that is the currency resides as just numbers in a computer. Maybe you have yours on a hardware wallet in a fireproof safe. Most don't. Especially those launderers who are shuffling coin around.

There are other cryptocurrencies that (try to) solve problem 1), e.g. Monero.

There is a GNU project [1] that's basically an electronic cash. It has no restrictions on what you use as currency (fiat, gold, bitcoin). But the government cannot track what you buy. At the same time merchants can be taxed, so there should be no issues from the legislation standpoint.

[1]: https://taler.net/en/

do you think all attempts to stop money laundering are bad? isn't it reasonable to try to prevent people from profiting off stuff that we all agree is bad? trying to figure out if you are saying there are downsides, or that its all bad.

On the flip side, your piles of cash are only valuable at the moment. Print enough new money, and your cash is worthless, at which point its value has been taken from you without any interaction with you.