The fourth condition means it must already be considered a value before it can be used as a currency. If there isn’t independent support for its having value, the claim that Bitcoin has value is circular. See below:
1. Bitcoin is a value because it can be used as a currency.
2. Bitcoin can be used as a currency because it is a [long-term stored] value.
Second, the fact that Bitcoin is finite doesn’t by itself make it a value. Scarcity does not determine whether something is a value or not. Scarcity only determines the price of something that is already determined to be a value because of another reason. For example, certain forms of toxic waste may be scarce but that doesn’t mean the waste is a value.
It’s not circular your assumptions are just off. The two criterias for a store of value are:
1. Scarcity(Supply relative to other goods).
2. Durability(No loss in functionality with repeated use).
These two alone don’t determine if the market will assign value to it, or if this will be used as money over everything else, but you can determine how good of a store of value it is with these.
There’s a good theory of what actually becomes money by carl menger, he noticed that different goods have different degrees of saleability(marketability, how easy it is to do trade with a good), the most saleable good becomes the dominant money naturally, because it will become easier and easier to exchange with it. (That’s why fiat replaced gold).
Money wasn’t founded by the state, it came into play naturally before all of this. There’s different degrees of quality of money, and if a central authority starts abusing it, it looses its beneficial function for everyone(Fiat). These are things menger predicted generations ago.
Your toxic waste is scarce and durable, but terribly hard to do trade with, so the market won’t use it as money and it doesn’t get more and more value assigned to it. Bitcoin is scarce and durable, and becomes easier and easier to do trades with over time(the more the acceptability rises), so it’s on its way to become more dominant money, and will have more value assigned to it over time. We’re still in the first stages, that’s why the price will keep exploding, until it’s relatively stable.
Bitcoin has no such basis or any other basis. Without a valid basis to justify why Bitcoin has real value, the proper default position to take is to assume that Bitcoin has no real value.
Bitcoin is becoming the highest quality money we have, and all that naturally, no state is needed for this. If you don’t get why it’s winning, you didn’t compare it to other forms of money yet.