Or to put it another way, it's a pyramid scheme with some geek-friendly features.
The fact that the currency is as stable as it is is remarkable, and this is a perfect site to take advantage of bitcoins.
You could say that for any currency you might care to invent. Limited-edition Franklin Mint velvet Elvis collector plates? They'd be a great currency, if only you could persuade anyone to use 'em.
Alternatively, if you don't like that, then I could invent Bitcoin Prime. It's exactly like Bitcoins, except... well, it's called Bitcoin Prime. Every string of bits that is a bitcoin is also a Bitcoin Prime... except that regardless of who "owns" that bitcoin, I own the Bitcoin Prime. Who wants to buy some?
(Oh, and if such a thing ever does become popular, I guarantee that despotic governments, nanny states and corrupt bankers will find a way to get in on the action.)
The fact that the currency is as stable as it is is remarkable
Stable on a one-year timescale? When the only people who own them so far are the first-gen speculators trying to drive the price up? The "beanie baby" alternative currency lasted longer than that.
True, but Franklin Mint collector plates are not supremely divisible, easily transferable, or free to store.
Alternatively, if you don't like that, then I could invent Bitcoin Prime. It's exactly like Bitcoins, except... well, it's called Bitcoin Prime. Every string of bits that is a bitcoin is also a Bitcoin Prime... except that regardless of who "owns" that bitcoin, I own the Bitcoin Prime. Who wants to buy some?
Go ahead and try, nobody will get on your bandwagon because the market will expect that a fragmented market for crypto-currency is in nobody's interests.
Oh, and if such a thing ever does become popular, I guarantee that despotic governments, nanny states and corrupt bankers will find a way to get in on the action.
Short of large scale quantum computing (which is my largest semi-fear), bitcoins mathematically cannot be controlled. Your statement is the equivalent of "if ssh tunneling every truly took hold you can guarantee that despotic governments will will find a way to listen in on them." While some governments may try to take measures stop traffic that looks as if it could be bitcoin, they cannot stop the wallet-on-a-usb-stick and in practice they would have an extraordinarily hard time doing so anyways.
There is a real market need for non-reversible, hidden transactions, driven mostly by the Governments that erect inane laws in the first place. Also, governments move slowly, they won't turn their focus onto bit coins until the first kidnapping and ransom is facilitated via bitcoins (a very real possibility).
BitCoin's transactions are all publicly available, even if only coins can be tracked, not users.
Edit: and by transaction I mean a "wallet" is loaded up with bitcoins and then handed off to someone else.
Is your bitcoin wallet covered by your home insurance policy against loss or theft?
the currency will fail as soon as NSA withdraws its funding from this project of distributed generation of these hash signatures with very specific properties. Who else do you think maintains such a stable and modestly growing valuation? Free market? :)
Some of the positives:
* anonymous
* decentralized
* finite supply
* no transaction fees
* open source
* growing in usage
* is traded on online currency markets
I'm sure there are more, but that is just off the top of my head. BTW, I'm speaking as someone who has ZERO BTC.
I mean, the more widespread the use of bitcoins the more negligible the initial advantage of early adopters will become.
The first question is really, "Why should we use money?" I'm not going to get into that in any depth here, but the short answer is that money allows you to collaborate with people you don't trust, or even know, in efficiently using scarce resources.
As for the second question, they're currently easier to transfer over the internet than dollars or euros, less prone to fraud, and more anonymous.
(I don't own any Bitcoins.)
Considering bitcoins actually have value (the market works, you can buy and sell them - right now they're roughly $1), it's a real shot at micropayments done right.
I think it also puts us in the right direction in terms of globalization. There are many problems with doing business internationally. The first of which is foreign exchange rates, if we all accepted one currency international transactions become simpler
Personally I don't think it solves the problem in an optimal manner, but if it starts a movement, then I'm all for it.