And why the bitcoin value is entirely dependent on the black market.
It is simple supply and demand. Lets look at each side.
Supply:
Supplied by miners. Any serious operation NEEDS to sell to pay utilities. That creates a steady supply of bitcoins offered at market price on a regular basis.
That alone is what kills it at this point. Everyone is still using this a profit making game, which means all mined coins are getting sold off for market price.
Bottom line: almost no one wants Bitcoins for Bitcoin's sake. People want Bitcoins to sell for dollars now or later, or they want them to purchase illegal items. That's really all they're used for right now and it's unfortunate.