The ethos assumes a world in which Bitcoin has become widely accepted as a currency and reached a stable exchange rate.

That world wasn't necessarily impossible. Imagine that the US reconceived the dollar as a coin, and everybody simply accepted it as a replacement currency. Potentially, a very large bank or credit card company could have done that with a stablecoin pegged to the dollar.

But that's not what happened. Bitcoin was never adopted as a currency so there was no way to anchor its value. Infinite shitcoins popped up, making cryptocurrency as a whole the most inflationary system in the universe (because anybody can mint their own coins). The whitepaper never considered that possibility.

It's still possible that the US government could decide to start taking BTC for payment of taxes, at some fixed exchange rate. That would anchor the price of BTC, and the whitepaper ethos could find a foothold.

IMO it was always a bad fit for a prospective currency, since its nature is tilted towards deflation, a speculative asset to be hoarded while everyone continues to conduct normal "I need a sandwich" business in anything else.

Good point. It's strange as it seems like using Bitcoin to buy things is structurally difficult anyway. If that should have held the price stable ... it isn't very good at doing that thing.