No one said it won't be used for settlement. But the value provided by the finite supply combined with the network's security should be considered in relation to transaction fees. Even at $1 or $20 fees, that value could be entirely worth it. Personally, I don't think Bitcoin is very useful for commerce (it could be with Layer 2 applications). It's useful for P2P value storage and transfer. Leaving the context of $3 cups of coffee and entering the context of people storing their net worth in Bitcoin is where this is relevant.
Bitcoin is arguably the best and only viable payment solution for online transactions.
Credit/debit cards aren't safe to use on the internet, as fraud is common, and leaving all your credit card info online to pay online is just too risky. Credit/debit cards just weren't designed with the internet in mind.
Cash obviously won't work on the internet at all.
There's paypal and such, but then there's the problem with how do you pay paypal?
But even if bitcoin would only be used as an internet currency, that's still a huge market. And bitcoin is already becoming a big player in remittance.
I use credit cards all the time online, and I get cash back for it, too. I'm covered for fraudulent charges (which have happened once in over 10 years using them). The optimal way to use Paypal is to use their credit line and pay them by electronic check. You could probably pay them by snail mail if you wanted.
Anyway, this is getting away from the topic, which is being taken for granted. The real situation is that blocks are not full; they've leveled off at ~75% full, even as SPV mining becomes less prevalent. According to https://bitcoinfees.21.co, 60 satoshis/byte is enough to get into the next block, which is ~ $0.07 based on median transaction size. Talk about hand-waving!
There could be any number of reasons why blocks aren't filling up (or why average block size spiked earlier in the year). There may have been ongoing DOS/spam attacks that have died down. Services (and people) have probably gotten smarter about batching payments and cutting out unnecessary spends (I have). One would think that rationally, miners would be picking up transactions with low (but non-zero) fees instead of mining non-full blocks... so it may be a matter of fee policy enforcement, as we do see a steady ~2000 unconfirmed transactions even after many 100-600kb blocks in a row.