I see more and more articles of the USD being used for illegal activities, such as
funding of terrorists and unconstitutional, illegal wars, funding of wars that cause severe infringement of civil liberties like
the war on drugs, among other things. I am pretty sure that when goons smash into convenience stores and steal stuff, then the money they probably steal is USD, which makes it criminal currency. Also, I am pretty sure that the baseball bats that majority of the goons have bought were paid for by the USD.
Also, most people collect rain water, drink raw milk, and throw cannabis seeds in soil, all three acts which are considered serious illegal felonies punishable by seriously expensive fines and extensive jail time, possibly life in prison.
Some people also walk, drive, fish, or hunt without a permit that can easily be bought for in USD.
Will this hurt USD in the long run? Will governments ban this just like they started to do with paying in cash for some services to harden the use of illegal activities, and money laundering?
Well as I said with a the same question with bitcoin, you can't blame a currency for it being used for illegal activities.
What people do is entirely their own choice and the government cannot control that. You can't blame the government when people use USD or CNY for buying drugs, that's only because their status as a currency is confirmed and undisputed.
Same with bitcoin, when people use bitcoin to buy goods that are illegal people should blame bitcoin for the incident.
It only means that bitcoin is a good way to store people's wealth, and even the drug dealers agree with that, and they are very particular about their money
Like gambling things and trading illegal items purchasing those illegal and pay them back with bitcoin. Every currency is being used in legal and illegal activities. 
