Volatility.

There are three primary needs and uses that bitcoin can address:

(1) A store of value.
(2) A transactional currency.
(3) Speculation.

But...

(1) If you've got a quantity of wealth you need to safely store somewhere, you're sure as hell not going to pick bitcoin.
(2) If you're a merchant, you're not the least bit interested in swings that will either triple or decimate your margin.
(3) So all we're left with is people buying bitcoin today because tomorrow it'll be double, then selling at a loss this afternoon because by morning it'll be worth half. Basically: tulip bulbs.

Where do we go from here? What do we do to fix these problems?

I don't know. I wish I did.