That’s fair enough you can have a verification with the note. My point is, I can still print a fake bitcoin note. You will have already put your fiat into this ATM. Your fiat is already gone, and afterwards you discover this note is a fake, what do you do then? You trusted the issuer of the bitcoin note but it was fake. Then you’re screwed.

As for your last comment, sure fiat is just fiat backed by faith in the government, but at least I can spend it. The next person I trade with will definitely accept it.