First of all, how much money actually came into bitcoin to cause the rally to $1200? The market cap increased from about 2 billion to 14 billion- this is a difference of 12 billion, but did 12 billion dollars really come into the bitcoin ecosystem?
Right now a buyer with 10 million dollars could probably push the price up by about 100 dollars, if you look at the bid ask spreads, which are very shallow on the ask side. A 100 dollar increase in market value of bitcoin translates to a 1 billion increase in market cap.
There truly is no such thing as bad publicity- the main barrier to bitcoin acceptance is people's ability to understand what bitcoin is, and this is different for every person. Some people might understand what it means to the global economy and buy, some people might simply understand it allows them to buy things they were unable to before, and some may only understand that it allows them to get a little publicity and attract more customers.
Buyers in Cyprus didn't cause the rally to 200, and buyers in China didn't cause the rally to 1200- people's reaction to the goings on in China and Cyprus worldwide cause the rallies. Everyone knew that people in China were sick of capital controls and worried about the dollar, which caused a lot of people to buy in.
So the real question to answer before the question "Where is the money for the next rally going to come from?" is "How much money caused the last rally?"
This is hard to answer, but I think it is safe to say that the last rally was caused by less than $100 million in "new" money, and that the next rally will have to be caused by more than $200 million in "new" money, new to the bitcoin ecosystem, that is.
The Fed's quantitative easing is injecting about $118,000,000 an hour into the US financial system. I have heard some on this forum saying the stock market, which you suggest as a safer alternative to bitcoin, has soaked up some of this money, leading to the recent rally in stock prices.
The biggest mutual fund recently lost $41 billion just based on the Fed suggesting that they might ease up on QE, which they didn't.
The amount of money needed to cause another rally in bitcoin is really miniscule, considering numbers like these. Cracks are really starting to appear in the dollar, and I think time will tell that no one and nothing in this world is too big to fail. When flight out of the dollar starts to happen, look out, because you will see not millions, but billions flowing into bitcoin. I think this will happen very fast when it does and without much warning. This is why a lot of speculators who think themselves so clever with their fancy strategies for making hundreds and thousands buying and selling will wake up one morning and realize they would have done better if they'd just bought and held...
So in short, an increasing number of people are poised to buy, but are just waiting to see if the price is going to go down. If you look at google trend, worldwide searches on bitcoin are down- but in Brazil and many other countries, interest is up. There are probably close to 1 billion people with enough access to and knowledge of computers to buy and use bitcoin. There is currently one smartphone for very five people in the world. There are 1 million coinbase accounts, so I would say right now there are between 2 and 5 million people who can and do use bitcoin. This is less than 1 out of 100. I would say with certainty that 1 out of 100 people would be interested in using bitcoin. I wouldn't be surprised if it were 5 out 100. Let's just be REALLY conservative and say that eventually 1 out of 100 bitcoin users, or a total of 10 million people buy and use bitcoin. If each person only had an average of 100 dollars in bitcoin, since they are so conservative and think bitcoin is risky, this would be 500 million new dollars coming into bitcoin- which could easily raise the price by 300+ dollars.
These numbers are just to illustrate the point that that to double the current market cap from 5 billion to 10 billion (doubling the market value of bitcoin) would require far less than 5 billion dollars. I am saying it could even be done with 200 million dollars or less. This is because everyone holds, because people who understand bitcoin know it is going to increase in value relative to fiat.
People are dying all the time and leaving their money to their tech savvy kids. More and more people are learning about bitcoin every day, and more and more people are getting smart phones and learning to use the internet every day. So bitcoin reaching 1% of the internet population and those people buying $100 worth at any price would probably be enough to increase the value at least 5 fold. And this estimate is really conservative- as smartphone bitcoin wallets and mobile internet becomes faster and more widespread, this absolutely has the potential to go seriously viral.
And need I state it again? A ponzi scheme offers no utility- all it does is promise returns to people, and then delivers those returns based solely on more people investing in the ponzi scheme. This means that as soon as people realize they are ponzi schemes, they collapse.
Bitcoin offers the utility of solving the problem of double spends and fraud, solving the problem of inflationary fiat currency, solving the problem of capital controls that benefit specific groups at the expense of everyone else, solving the problem of high transaction fees and delays for international transfers, solving the problem of the difficulty of dividing gold into precise denominations, and enables some level of anonymity, which enables safer transactions for black martketeers- the black market being estimated at 1.8 trillion- if bitcoin even captured 1% of that, which would be incredibly profitable to those engaged in the black market trade, that would account for enough to take bitcoin into a major rally.
All of these factors converging make for a potent combination- but let's suppose you're right- let's suppose bitcoin is too difficult to use and fiat is working fine, (which they're not) and bitcoin has maxed out right now. No one else is going to join the economy, the million or so bitcoin users right now are as big as it's ever going to get... aside from this sounding utterly insane, the fact is, if no one else and no new money ever joins the bitcoin ecosystem again, it will still hold its value- whereas with a ponzi scheme, as soon as people stop buying into it, it stops paying out and dies.
In short, the answer to your question "Where will the money come from?" is, everywhere.
