Physical cash is decentralized and used for a lot of bad stuff. However, it's not digital/online, so there are a lot of ways it's not useful, and it's also easier to investigate in some ways (bulk currency smuggled out of the country can be tracked the same way drugs coming in are tracked.)

Bank/etc. operated payment systems, at least the above-board ones, at least pay some level of attention to AML, anti other criminal activity, etc. It's not uniformly effective, sure, but it's hard to operate a large child-porn-for-Visa merchant, and visa/card issuers/gateways tend to cooperate fully with various government agencies in both stopping the activity and in catching/prosecuting the offenders.