Fiat and cryptocurrency are the same but people in society differentiate them and value fiat because its adopted by the government far back, and since the existence of the world and also a specific country, so from my research I find out that government just disliked cryptocurrency for nothing,
So differentiating fiat from bitcoin is valueless because irrespective the importance and massive adoption of fiat currency from its existence before cryptocurrency, it's obvious that fiat is money and bitcoin is money, their functions and contribution in society never depart from each other, so bitcoin now is the shortest way of transactions across the world without much process or procedures, using bitcoin everything buyable is easier to purchase without stress, so from my perspective I prefer bitcoin than fiat currency due to fast transactions process across another country, and nothing fiat can purchase bitcoin can't purchase, so no difference between both because all are currency.
Even though fiat and digital currency has the same functions and can be use as mode of payments but still these two currency are different. Remember that fiat money already exist long time ago while digital currency is just more than ten years. People are much aware and convenience in using fiat money rather than digital currency. Also we can't force government to accept and legalize a decentralized digital currency. Not all people already know how to use bitcoin so they are still favor in using fiat money.