It really seems to be true. The US government has the world's largest public debt. About 20 trillion. If all who have dollars will present them for payment then America will be bankrupt. It is logical to assume that bitcoin will collect all those dollars and then go bankrupt. It is possible that bitcoin was invented and implemented by us intelligence agencies.
Indeed they say things that are quite logical and it is also their right to say it for a reason quite logical, I do agree with them and I understand a bit of the government's opposition to bitcoin for legal payments.
What is so logical about what they are saying and how does that even have anything to do with bitcoin? It has already became obvious right from time that dollar has been crashing in its value, so to me, bitcoin is not burning the money, but money burning itself, and moreover, I still do not see how fiat or physical cash will still not stay relevant, so at the end, bitcoin will only serve more as a safe haven for those who believe in holding it more than the crappy fiat.
Bitcoin even if its the most popular cryptocurrency won't have the necessary means to defeat Fiat currency. The most realistic reason out there is because Fiat currency is more practical to be used physically when buying goods.
Realistically, it is not even something that can even happen. The government will always want fiat to stay relevant and they will always do everything in their power to make that happen. Bitcoin on the other hand will serve as digital currency for global exchange, so the idea of burning of money or any term anyone wants to call it does not sound reasonable at all.