By and large you should draw a line between digital money and cryptocurrency such as bitcoin. Digital money that is near at hand has been invented by central banks to represent tokenized fiat and being such they inherited all its cons. They trampling over facts of the need to trust to 3rd party and the lack of the real backing. So in the large run of competition with cryptocurrency one can expect downfall of the digital money. Bitcoin will remain a winner.
I agree with you to a degree. However, Bitcoin is also digital money or virtual currency as some folks will choose to call it. It's just a matter of semantics. Bitcoin will not bring about the downfall of "a country's digital money" in the long run they are going to coexist. A country might choose to adopt bitcoin as a legal tender but that doesn't mean that it's digital currency has failed if it chooses not to have one.