> You can exchange your local government currency for services and goods. With Bitcoin you first have to convert them into a local government currency and then buy services and goods. This only works because those local government currencies exist in the first place. I'll pull this out of nowhere and say that 95% of the value of Bitcoin is derived from government currencies by that I mean the reason Bitcoin is valuable is that you can exchange it for government currencies.

So to be clear, bitcoin becomes "legitimate" when some critical mass of vendors accept it? This seems to imply that once the ponzi scheme becomes big enough it becomes legitimate (provided of course that we accept that btc is a ponzi scheme), which feels counterintuitive?