Except governments around the world have been talking about a digital dollar / digital currencies for years now. I'm not sure exactly what is so outlandish about it. The fiat system is collapsing, and the signs are quite plain to see. Can't print fake money forever...

Usually, what they mean is fiat tokens, minted much like paper currency.

There's a large difference between fiat currency and what you're calling fiat tokens. One is extremely difficult to trace - the other is extremely easy and allows the nation states that are "minting" them to track every transaction being made with them.

They are nothing like paper currency outside of being another abstraction of actual value and being issued / controlled by the banking cartel.