The work isn't what makes Bitcoins valuable though. I could create a new PoW cryptocurrency with twice the mining difficulty of Bitcoin, and it wouldn't be worth as much as Bitcoin, let alone twice as much. The labor theory of value doesn't hold up.

The only thing that makes Bitcoin, PoS coins, gold, or anything else valuable is a market of willing buyers. There seems to be no rule stopping that market from developing for practically any asset no matter how absurd.