This was discussed early on in the history of bitcoin. You’re conflating banks, which aren’t a societal detriment per se, with unbanked fiduciary media, which is everywhere and always the problem (see Austrian Business Cycle Theory). The part of the equation that you’re missing is automated proof of reserves and automated bank runs making fractional reserve banking untenable despite the existence of banks.

If you want to use a different protocol on a different network that sacrifices monetary assurances for the sake of privacy and also suffers from the same inherent non-scalability of all blockchains then that’s your prerogative, but it’s everyone else’s prerogative to disregard softer money in favor of harder money.