Right short-term, but eventually, the market will find its way to recover. Historically, after a blow-off from an ATH, overall market sentiment was bearish, and that's the case for today. Personally I think that the price per se wouldn't restrict any growth for bitcoin. If anything, it promotes it and entices more entities to come in and do their business with the said cryptocurrency.

As for the general notion that cryptos would replace the fiat currency system eventually, it won't, though it can always co-exist with it just like gold-fiat relationship for the past centuries.