wouldn't replace currency since not many places accept it at this time.
GYFT.com accepts Bitcoin for gift cards to over two hundred companies.
Overstock.com
Dell Computer
Expedia
and ... mamy companies are offering Bitcoin backed debit cards because
1) Bitcoin has zero fraud
2) zero chargeback
3) Much lower transaction fees
4) zero default
Merchant acceptance is not now or going to be an issue. Bitcoin is money and businesses will accept money (that is what they are in business for, correct).