The US government forces US citizens to trade with dollars. The Chinese can take their dollars and buy goods the Americans produce. The American producer has to accept the paper dollar (that for itself has no value) because government is pointing a gun at him.  Basically nothing (paper dollar) becomes something because the US government walks into the shop with me with guns and "convinces" the shop owner that I can trade Nothing (my paper dollar) for Something (his goods).

Now what can I do with bitcoin once you transferred it to me?