In the beginning, BTC could be used to exchange of low value of virtual items, such as buying web sites or game points, virtual items, etc., afterwards, some people in order to get these virtual items, items may be in online auction own reality for BTC, others want to buy the real goods, but no BTC at hand, and then use real money to exchange BTC, as a result, BTC begin to flow, and have a "value".
In other words, bitcoin is inherently valuable as a means of payment; If it loses its function as a means of payment, it becomes worthless.
The value of money: it exists because of payment.
I think, Bitcoin currently is best used as an investment asset and not as a means of payment as the coin is currently not completely accepted in the financial market. However, due to its volatile nature, the coin is a great asset as it has helped earn great profit returns in a short period of time.
Although, the coin is a good means for making transactions throughout the world, the coin's speed of transactions has fallen in comparison to other coins.
The coin can replace fiat but it will take the coin a few years to do so.