Ron Paul is correct it is not money. Bitcoin is no different than a pokemon card. But unlike a pokemon card they are each identical (there is no Charizard). The only reason bitcoin has value is people give it value. If it drops to $1 a certain type of person will buy more. If people use it in a transaction, many will keep a couple coins for later purchases. These coins are collectibles, as are pokemon cards.
Bitcoin as a collectible give it value. Once it has any value, it can be traded as a currency. Everyday bitcoin usually strengthens as a collectible.
Except that the term "currency" is synonymous with "money". "Money" is any medium of exchange. In this case, Bitcoin exists for the sole purpose of fulfilling that very role. It exists only to facilitate trade. Unlike physical commodities, it is good for nothing else. You will never see Lil' Wayne with a grill full of Bitcoins unless he has his public key printed in gold on his grill so he can accept donations.
If a community started accepting Pokemon cards in exchange for goods and services, Pokemon cards would be money. Anything can be money, if people are willing to accept it as such. That's why little green pieces of cotton paper with serial codes written on them are money.