All currencies rely on belief (like those flats in Monty Python). It is possible that gold could lose global belief, but unlikely, given the long history of belief. The US dollar too could lose faith, but again, a pretty good history of trust. Bitcoin? I think belief and trust battle novelty a bit. Will enough people believe, in 20 years, to power the computations necessary at that point? Or will a more novel and exciting currency emerge?
Gold isn't a currency at the moment. Even if no one wanted gold for its store of value properties, they'd still want it for electronics, science etc. at which point the market would revitalize.
In a literal sense we have gold coins. I guess it's interesting that governments mint and sell them for a thin premium on bullion prices. And then, yeah, I'm sure there are things you could buy with a pocket full of Krugerrands. Really though, governments are giving you this opportunity to go off their currency standard. If you want to keep part of your wealth, near-cash, in gold coins, you don't have to use American Eagles to do it.
Which is to say (not disagreeing, just saw an opportunity to jump in): it has a floor value. It might not be $1000 or even $100 per ounce, but it is at least a floor of $1 or $10.
The complaint Mr Krugman is registering is that Bitcoin's don't even have that. If my car is totaled, I can always sell it for $100 for scrap. There is no bit scrap dealer.
