You are quite right Bitcoin possibly cannot replace Fiat. The best possible outcome is Bitcoin will only become more adopted as a currency for transactions. However looking at the odds this is still going to be challenging based on the fact that most governmental laws are against Bitcoin in many countries and also because as Bitcoin adoption increases so will fees.
Bitcoin fees is definitely not a problem for everyone but it is for a majority of users. Even those who are able to pay these high fees easily are still not happy with it because they are aware that it is possible for them to pay lesser.
I read the Bitcoin whitepaper again and in the conclusion Bitcoin is only an electronic transaction system without the need to rely on trust and without going through financial institutions called third parties.
Bitcoin through its whitepaper is not meant to replace fiat money but as an alternative to make it easier for people to carry out transactions anywhere with just a digital signature as a solution to not needing a third party.
Many countries that I know of still carry out strict supervision of Bitcoin because its use in framing violates the provisions even though it is not guaranteed to be 100% correct.
If one day we experience for ourselves that Bitcoin will become the most widely adopted currency, I think that will be the time when they realize that using Bitcoin technology is more effective than a transaction system using fiat.
Fees are increasing, in my opinion, not because of the large adoption of Bitcoin but because there are several ongoing problems that are still being sought for solutions.
High fees can be a problem for business people who use Bitcoin as a means of payment. However, I am confident and optimistic that the problem of high Bitcoin transaction fees will return to normal. I'm sure it will be finished in about two months.