In many ways, yes, it is a lot better: reliability, cost of transaction, etc., etc., but it becomes totally useless when you have to make an off-line payment in a country or a place with no or limited internet access. You can't even buy a bottle of water or a hamburger. Think about it. You can have a lot of BTC in your digital and hard wallets striding along the street in a foreign town and if they don't have internet, you're broke for them!
There must be some way out of it...

Bitcoin is better than banknotes because bitcoin that has blockchain technology can record all transactions and still intact will not be lost or deleted. And bitcoin is more popular these days and bitcoin has easy ways to access and to transact, and since bitcoin itself are havingva faster transactions in terms of money exchange with a very low fees. And also, if we are just looking at this angle then we can tell that bitcoin is really better than banknotes but, if we look at accessibility such as the remote areas without electricity and internet access. On remote areas that had an shortage of sources in the third world countries then we can say that banknotes is better than bitcoin.

it's costly for the society (more regulations, more resources to deter, individual or business accepting it accidentally >direct loss,...) Counterfeit money exists since the Ancient Rome at least, and it can destroy a government and its economy. Even the Nazis were counterfeiting the USD and GBP (Operation Bernhard) If only 1% of your circulating currency is fake your government is out. It can't borrow money anymore, business will stop to accept the currency, and since it's the only one, then the economy will be dead.