What does your question mean, that the FFP is "on the way out?"
If you mean, are airlines transitioning to a revenue-based model for direct benefit accrual, yes.
Does this mean, it will become less worthwhile doing MRs and so on? Yes, and the perks of the regular tiers (non-secret spend-tier based levels like GS, 360 etc) will diminish.
If you mean, in the broad economic landscape, will FFP shrink and disappear? Most assuredly, no. Evidence contradicts that claim.
They already function as profit-centers and alternative currencies. Redemption options are increasing, additional ways/links to other programs are being introduced every week e.g. UA MP/Marriott or DL SM/Starwood (an unbelievable conjuncture of what is best in class with what is :-: mejor en su clase :-: ) Net value is INCREASING, at the same time as core value generation via flying rapidly diminishes. Customers will have to pursue other paths to generate benefits, such as allied programs, credit card spend, partner company patronage and so on. Exactly as intended.
If Bitcoins - which are gray-market instruments at best - are expanding, appreciating and becoming more useful, compare them with FFP which are far more embedded into our daily lives and institutional fabrics already.
They are already functioning as partial alternative currencies.