For non-flamencos, I can't say -- maybe it is having an incredible rasqueado, or being able to play Entre Dos Aguas, or Luna del Fuego, or a tremolo from granainas.
For flamencos, it is the ability (at whatever level of skill) to accompany a knowledgeable singer (and knowledgeable dancer) who is performing one of the standard forms in a more or less standard way. You don't have to be very *good* as guitarist to qualify. Many singers in Spain, for instance, knowing only two or three chords, and playing execrably by anyone's standards, can crudely accompany themselves or someone else. Most wouldn't claim to be guitarists at all. But they would claim that whatever they're doing on the guitar is flamenco, not something else. They know the song, and they know what the guitar needs to sound like to go with that, even if they don't know the guitar itself well enough to pull it off very well.
So, whatever else you are able to add to that -- machine-gun rasqueado, blinding picado, etc etc -- it starts there: you know how solea goes (as song or dance), for instance, and what will fit it on the guitar. It doesn't mean you have to sing or dance yourself (though that can be an eye-opener) anymore than a sportscaster has to be able to pitch. The sportscaster *does* have to know the game, however. (Or fans complain.)
This may sound like an eccentric definition to musicians who admire many other things about flamenco, and may not give two hoots about cante or baile (dance). All I can say is get yourself into a group of flamencos and check it out. The guitar will invariably wind up, by subtle or not-so-subtle consensus, in the hands of the guy who can accompany the singers and dancers, not those who can't, no matter how superb the others variously are as musicians and guitarists. It's not that superb musicians are not recognized and valued; only that for flamenco to happen, the group needs a guitarist who knows how to support the singers and dancers.
Try once,fail twice...