The actual problem is merchants are cashing BTC for bank currency immediately because they have limited use of them. When enough merchants accepts them, they'll no longer need to cash out which will be good for BTC then.
Actually, most merchants are using Bitpay or Coinbase, so they never touch BTC. Bitpay and Coinbase are dumping Bitcoin and capturing juicy spreads at the same time. I'm not sure this talking head in the OP is correct though because it doesn't matter how many merchants you have, if consumers aren't buying them to pay for stuff. This is just current BTC holders shopping, as is evidenced by a recent poll I saw at Coindesk, that said that 75% of merchants had seen little to no growth in revenue. Of course, people can't spend what they don't have.
So to say merchants are adopting Bitcoin, is really inaccurate. BitPay and Coinbase adopted Bitcoin, merchants are still using the same old fiat. They're just riding the hype and hoping to cash in on a little bit of the money current BTC holders have. The price keeps dropping because consumer demand to buy BTC is not there. It's really as simple as that. If people wanted them, they'd buy them. Numbers don't lie. You can blame China if you want, that only highlights the lack of consumer demand from the rest of the world.