As cryptocurrency gain more traction and 'normies' begin to become more accustomed to it, we will soon see it proliferating into mainstream usage.
There are many similarities between the evolution of crypto and fiat.
Before fiat gold was the currency of choice. It held value to people for a long time but had many problems as a currency, most importantly in liquidity. Fiat evolved to solve this problem, yet was originally set against a gold standard in order to convince people of its value. As fiat matured the FX markets allowed each currency to find a natural value and replace the gold standard. As the financial system matured other assets came into circulation including securities such as bonds and shares.
However fiat was from the outset a physical store of value, and had a very hard time adjusting to the instant, widespread and annonymous nature of the digital world.
Enter bitcoin. In the crypto world bitcoin has held the role of gold, a speculative commodity and the standard at which other cryptos are valued. As it grew in use people began to believe in its value, giving it merit. However there are many problems within its network, like gold, which prevent liquidity and use as a widespread currency. Just as fiat did altcoins emerged to solve this problem. Set against the value of BTC they attempt to solve liquidity issues. Bitcoin, as with gold, has began to transition to a commodity asset, allowing altcoins to take the role of highly liquid currency. Exchanges have yet to stop using what i call the 'bitcoin standard', but efforts are being made which will allow the value of altcoins to be positioned against each other much like the FX markets. In the place of securities we see tokens emerging, each with their own unique monetary benefits.
Cryptocurrency has democratized currency. It has opened up the financial system to anyone and everyone across the world.
What i would love to see soon is a new state formed with no fiat in place, instead allowing its economy to develop with cryptocurrency.
Im not sure that cryptocurrency is mature enough for it yet, but it would be an interesting experiment in use case.
Fiat will continue for a very long time. However, btc will cease once it's completely mined out. Crypto is different from fiat it started digitally without much market cap whereas fiat is controlled by the government which makes it so powerful when compared to alts and btc.
I'm not suggesting fiat will ever stop to exist. As long as sovereign states exist i believe so too will fiat.
You make a good point about fiat being born at a set price whereas crypto started from nothing and built market cap.
However once bitcoin is mined out surely price will only continue to increase at an increasing rate?
Currently new BTC dilutes the value of old BTC keeping price down.
Once mining is over supply will actually start to decrease due to natural loss of BTC in circulation, pushing up the value of each remaining BTC. Also there will be no new supply to dilute growth.
So BTC will only grow faster than ever.