If all money goes digital, you lose the ability to make unsupervised purchases.
Harr harr, yes drugs. But also condoms or plan b pills, which magically became a political target recently. Or any other previously innocuous thing that could someday shift into a political target.
That tracking also means anyone who buys that data can profile you. Card charges at the same store every work day? Someone who cares knows where you go for lunch. Maybe its a stalker, maybe just an advertiser trying to get you specific ads. Do you want either having that info? Buying the same specific goods for meals, or hobbies, on a regular basis? Ad companies love that, they can up prices on things your data says is a dependant purchase.
You dont want your entire purchase history trackable. Its not about having things to hide, its about not wanting someone to be able to pick you apart like a lab rat. Cash helps this, but lots of groups and people want a cashless society.
If cashless ever becomes a reality, you want a digital cash replacement to already be in place, if not underway. Better that the concept gets worked out now while we still have cash, than scrambling to set it up in a future where cash retires.