Merchant adoption and volatility. There's just no real reason for most people to use bitcoin yet unfortunately. I fear it may always be a niche thing. Hope I'm wrong, though.
volatility can be negated only with adoption, great adoption, so the issue is only one, adoption, and always will be unless 1B(or around that) people start use bitcoin
bitcoin can also work as a niche thing imho, i don't see the problem with that, maybe not forever because miners need an incentive in the future to keep mining with a smaller reward...