It sounds so cool that people are using cashless methods to pay in China. It will take some time but most of countries will take this route only in future.
No, traditional money will be always used. I do not think that the cryptocurrency can replace it ever. Bitcoins and altcoins will coexist with fiat, and it will be a norm.
Well I think bitcoin has all the guts to make fiat or the traditional currency disappear as we can see now people are using bitcoin more than digital currency so have patience soon the bitcoin will be global currency all over the world and in every market and every shopping mall people will prefer buying goods using bitcoin only, as it is more easy, more reliable than fiat or paper money.