Of course, I'm guilty of confusing the topic because I talked about credit and debit cards in a book with the title "Digital Cash." Sorry about that. But I think the whole debate is really pretty confusing. Real "cash", i.e. Federal Reserve Notes, are pretty traceable. They've got serial numbers on them. If it was practical to require everyone to keep a log book of serial numbers, someone could really track the flow of currency throughout the economy. Note that serial numbers aren't that important for paper currency because the physical difficulty of finding a good printing press is supposed to prevent counterfeitting. Digital "cash" requires the serial numbers to prevent copying. (Everyone should read today's NYT article on the counterfeits.) So I would argue that Fed. Reserve notes aren't "cash" either. It's only a matter of time before FinCen starts requiring everyone to report every serial number. But while I think Tim's point is well taken and essentially correct, we should remember that "cash" is term that also often means immediately negotiable. For instance, many people who need to trade large amounts will trade T-bills. These pieces of paper pay interest! In other circumstances, bringing a cashier's check is what people mean when they talk about "paying in cash." A real estate buyer who actually showed up at a closing with $300,000 in $100 bills would be pretty unpopular, even if he said he was going to pay in "cash". So, I guess it's all just a question of semantics. But that's life on the Information Super highway where it may just be illegal to run the "finger" protocol. -Peter