My biggest issue with bitcoin is that it should be redeemable for something tangible other than $USD. The first virtual currency that addresses this and is directly convertible to watts or calories will be the currency to beat.
you just defined 'currency'. basically, your issue with bitcoin is that it can't be exchanged for goods and services.
this is quite the chicken and egg problem. but basically when people 'believe' it's a currency, they will accept it as one - thereby justifying that belief since it will be true due to all the other people accepting it.
dollars are only a worldwide currency because people and institutions think it's one - and if it were to stop being treated as currency it would stop being accepted as one. totally tautological - but there's currency for you.
That could easily be accomplished by bitcoin using the "colored coins" proposal. All it needs is for an electric utility to issue colored coins that it's willing to redeem for watts.
