Incidentally, if you don't think gold should be worth $1200/oz, you probably don't think 1 BTC should be worth anything.
(Of course, you can also lose a helluva lot of money, but then, to the person making millions off of bubbles, both the people who sell too late and the people who never buy are idiots.)
For these green pieces of paper, as long as its easiest to buy oil with them and that people depend on oil for energy, there will be people willing to buy these green papers. Because they trust they can exchange these papers for something valuable. So everyone that needs oil needs usd as of today (I think iran still sells thiers in euro and russia might start selling in rubbles. I haven't checked oil currencies in a while though, so if you're reading this, you should probably double check ;) )
I honnestly think that's why the us spends billions every year to secure the middle east. They have oil at home and they could easily massively move to renewable with the size of their territory and then export the tech.
But then people wouldn't be relying on oil for energy, and the dollar would lose it guarantee of value. And therefore its value.
Lots of traditional banks are incompetent and set in their ways. Shaking anything up internally requires lots of (office-) political capital.
Having an internal 'blockchain' project might give people just enough leeway and direct backing from above to push through lots of needed but unsettling improvements. Even though those improvements might not have anything to do with blockchains, and might even be better done without.
Of course, whether that value is $1 or $1000 depends on the number of people who believe in the currency enough to pay for the power to mine it.
Gold is a bit different since it has some baseline value from practical uses, but the store of value use case dominates those.