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It may be more like have cryto as gold, rather than fiat. People wouldn't have to accept it by law like they do with fiat, but they would probably want to accept it knowing it will only appreciate in value. Like gold you would probably get change in fiat.

I do agree though, there are quite a few practicalities to be worked through before this could work. In reality, fiat has no place in the developed world now. All payments should just be with your phone or NFC card.