Bitcoin is flavor of the month.
It's possible to conceive of a better cryptographic store of value (imagine a more deflationary version of bitcoin with close to zero coins generated on the network that requires 2-step verification in order for transactions to occur).
Conversely, it's possible to conceive of a better medium by which value can be transferred (imagine bitcoin with blocks generated every few seconds - fast enough to generate confirms that compete with credit card authorizations).
Other cryptocurrencies will gain popularity that offer superior options to bitcoin eventually, although this might take a while. Buffett's dead on about bitcoin, but I definitely see other cryptocurrencies existing in the future and being quite popular. Bitcoin's inability to compete with the instantaneous confirmation speed of cash, or the 5 second confirmation speed of credit cards, will render it obsolete eventually, fiat or not, it's just a terrible general currency platform.
More hogwash, CC transaction times are in the order of days, you just never see that. Online transactions, that don't much care about a ten minute delay, are still worth a decent chunk of change. They also benefit from other features of bitcoin.
A coin with no generation is worth nothing, surly you've heard of "pre-mine?" Quark tried quick generation, faster transactions (both pretty bad for a technical reason) and it sure seems to be floundering. Two step for transactions? Man, cmon...
http://bitcoin.stackexchange.com/questions/3718/what-are-multi-signature-transactionsAll this time the other currencies are taking, you admit "quite a while" are loosing ground every day. If it takes too long, people are not going to want to change. To do so would undermine the entire trust in the whole thing, someone is holding the bag, either customers, merchants, or the most likely - everyone. Why would they want to do the whole shebang all over again?
Not to say they can't co-exist together, which just adds a whole 'nother layer of complexity to the "feds is gonna get you!" theory.