Suppose I went to my local cafe to buy a coffee, and suppose the cafe accepted cryptocurrency. What incentive would I have to use that over fiat currency? None. If I pay with cryptocurrency for that transaction, there are 3 problems:
- the need to pay gas money, a similar idea to a transaction fee
- be contributing to global warming with the computationally-intensive nature of cryptocurrency
- cryptocurrency is not FDIC insured
By contrast, if I pay for the coffee with my debit card, I don't need to pay a transaction fee. The transaction would probably be quite a bit faster since nothing computationally intensive has to happen. Also, my money linked to my debit card is FDIC insured, unlike money in a cryptocurrency wallet.
So for multiple reasons outlined above, cryptocurrency is an inferior means of exchange compared to fiat currency.
Now, if you were to tell me that cryptocurrency's main advantage is not as a means of transaction but rather as an asset that could increase over time, now you're talking about it as a security.
The problem is that cryptocurrency companies do not have the same level of oversight and scrutiny as a public company traded on the stock market. So even as an asset, why would I entrust my money to some randos whose companies aren't subject to the same kinds of careful rules as companies traded on the stock market? I wouldn't.
You might argue that cryptocurrencies are high-risk high-reward. But there are other high risk high reward investments out there. It's a crowded space that cryptocurrencies are occupying! They're already competing with a lot of other investments in fiat currency.
Furthermore, even if I wanted something riskier than buying stocks from a company with a strong track record, there are always IPO's. For an IPO, I could scrutinize their SEC filings to try to gain as much knowledge as possible and decide whether to invest. By contrast, there is a lot less transparency about cryptocurrency companies.
If anyone thinks cryptocurrency will take over the world, the above reasons are why it won't. There are always going to be large swathes of the population for whom cryptocurrency does not solve a problem.
One of the few subsets of the population who could benefit from cryptocurrency is the unbanked (although you could argue whether keeping cash lying around could be safer than keeping it in cryptocurrency).
Yet only a tiny fraction of the population is unbanked! The vast majority of taxpayers in most countries are able to open a bank account in their country and have access to fiat currency. So cryptocurrency literally does not solve any particular problem for the average taxpayer while introducing negatives. This is why many people will always prefer fiat currency and would never bother using cryptocurrency.
