Sorry in advance for this wall of text and the redundant use of the word "currency." It makes for a shitty read, but I couldn't find a better way to construct my comment.

All joking aside [0], you seem a little over eager to discount Bitcoin in this regard.

Here's my take on BTC's relevance as a currency:

- Its 'success' as a currency in the developed world (in the way we use greenbacks & fiat / Chinese use Yuan in daily life) ...

... on this point, I've never been too hopeful. [1]

This definition of "success" is biased by most of our developed-world perspective. . tldr; - It will likely become 'relevant' without becoming a 'success' in the Western/1st-world sense.

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Observations on why Bitcoin will struggle to become a ubiquitous currency:

1.) This statement from the PBOC - more or less negates its chances in China as being a "first-class citizen" (status) currency.

This comes as no major surprise to me. But, what is surprising is the portion which reaffirmed the legality of the participation in Bitcoin in China ("... Bitcoin transaction as a commodity trading behavior on the Internet, ordinary people have the freedom to participate in the premise of own risk."), as you alluded to in your comment. This more than "leaves the door open." That said, the factors which contributed to this approach are unbelievably complex and probably nefarious (w/regards to BTC's future).

2.) In the USA, I don't see a pressing need for it to be used in the way we know dollars to be used. The reason here is that we have a historically stable system in place.

3.) The volatility of Bitcoin is not, and likely will never be, as stable as most of the fiat units in circulation. This would discourage me from paying my employees in Bitcoin.

4.) Since day one, we have all been apprehensive about the deflationary nature of the currency -- expressing the Keynesian-concern that spending in an economy is vital to the prosperity of said economy.

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With that being said, here is where-and-why I'm long ...

I.) ... because of the international nature of the protocol, one must think about those living in Iran, Zimbabwe, Argentina, Russia, etc.. In those places, I think it has legs as a currency, regardless of state-endorsement. Some of these states in crisis may even endorse Bitcoin.

I believe that perfection isn't sought after in the 3rd world, as confidence has been lost in the fiat systems in place. (This is the reason why greenbacks are so ubiquitous abroad.)

There's also a palpable anti-American sentiment in the third world that could discourage greenbacks' usage by the layman if there were a viable and universally accepted alternative.

But paper greenbacks don't play well with the internet. Bitcoins do. One can argue that you could still use greenbacks digitally abroad, but this is not without large transaction fees, and -- in the case of unstable countries -- there may uncertainty in the bank which is facilitating the financial services.

II.) ... it's nature has melded the idea of a cash dollar and a digital dollar into a decentralized, ephemeral-yet-"trustworthy" protocol. I can honestly say: I'd be a fool if I claimed to have the slightest idea how Bitcoin will innovate and make itself useful as a currency.

So, I actually believe that Bitcoin has relevance as a currency, just not in a way that would make sense to the developed world.

The above is part-and-parcel from Bitcoins as a store of value and other financial novelties, which I don't really have the time to enumerate.

[0] - "So much for the debate about bitcoin being a currency!"

[1] - [and it saddens me greatly, because I'm a Bitcoin fanboy, and I've believed since the early days that Bitcoin is special in many other ways. And no, I'm not a Bitcoin millionaire.]

If you enjoyed this comment - I am releasing a Bitcoin-related service in ten days, and, in the idealistic spirit of Hacker News, I kindly encourage you to add me to Google+ or Twitter, so that you can offer early feedback. @spencenow or https://plus.google.com/+SpencerDailey Thanks! :)