of course fiat is necessary. because fiat is more or less safer currency comparing with other alternative currencies such as crypto currencies. they are mostly backed by governments and also easy way to make payments.
Yes fiat currency are still important. And in some place they are more important then that of digital currency and cryptocurrency. Cryptocurrency are not a global currency, it ban in many place and many people still doesn't use it. And it is an independent currency so their is no stability in its price. In the other case fiat are world wide accept and it has more stability than that of cryptocurrency. Cryptocurrency currency are only use digitally so in those places electricity or Internet not available in those place you cannot use cryptocurrency but fiat currency you can use any time anyway. And people have more trusyon fiat currency than that of cryptocurrency.