It can but it may take time cause paper money is stable than digital or crypto currency. If crypto currency manages to become more stable it can replace paper money without an issue.
I agree. It will take time for all countries to accept digital cryptocurrency and for them to become stable. And then may be crypto will replace paper money.
Talking about stability....
nothing is stable, just look at the stock prices, oil/gold etc.
Cryptos are no more different than those in term of stability. The biggest difference is that they are not regulated atm.