>Can't something only have a value if your local government recognizes it at such?
The market is what determines what has value, and how much value something has.
An exception is fiat currency, i.e money that only has worth by fiat, which means government declaration.
Fiat paper currency is not money. The U.S Constitution even says that only gold and silver can be used as money, since you can't create them at will like you can paper currency.
BTC is more of a "money" than paper dollars are.