The chance is very low to happen a significant inflation unless world war III or worldwide epidemic disease occur. Let's assume any of this happened. Will people likely to switch their fiat currency into bitcoin?
If that's what happened and people attempt to switch their fiat into bitcoin, there will be a chance of fiat currency become nothing of value.
PS- I don't want world war or epidemic disease at all. i am just thinking at what point bitcoin will take over the fiat currency system.
There are number of ways the world can employ to fight such things. Increasing interest rate is one of the major weapons to fight inflation. It will create different situations for different group of people. People who are living on interest, will be benefited and people who are paying huge loans like housing, will be hit! None of these scenarios will make fiat worthless! So put that possibility out of the equation.
But yes, such kind of scenario can give a good boost to cryptos like Bitcoin and assets like Gold because there will be a group of people who would want to safeguard their capital. Nothing more can be expected!