That's a good point. Ordinary paper money are made from woods. IMO this problem is more important
Actually, dollar bills are usually made of plastic (like in Canada) or various fabrics.
But this is just a minor part of the environmental impact of fiat currencies. We also have to consider the ressources needed to run banks and pay their employees, the armored cars which move the money, the plastic on which credit cars are made, the cash registers, and the waste generated by an economy of planned obsolescence.