With all the vague claims about attacks and building a "bullet proof" system I have a hard time trusting them any more than a trader at a big bank selling their own complicated financial instrument. He seems to be trying to manipulate the prices with these statements too. Good thing it is unregulated. Oh yeah, and "He warned bitcoin traders not to panic or invest more money than they're willing to lose." IMHO this is a straight up admission it is a speculative investment and not a real currency at the moment.
> IMHO this is a straight up admission it is a speculative investment and not a real currency at the moment.
Did anyone ever claim that it was? I mean...it's a real currency in the sense that people are using it to exchange goods and services, but IMO anyone who has the expectation that Bitcoin should have had all of its issues figured out right out of the gate has their standards set a wee bit high.
I am not a banker or an economist, but when I hear the word currency I have certain expectations, savings and spending come to mind first. Speculation is not something I immediately think of. In reality the use of it as a currency seems to be limited, at the moment, to high margin items (food, virtual goods). While I have personally seen virtual services accepting Bitcoins I have yet to see a local small business accept them myself. I would not feel comfortably saving or spending them at the moment, so I don't look at them as a true currency. I do highly stress "at the moment" though, anything is possible and this is fascinating to watch from the sidelines.
My dad does hobby trading in the currency markets. It is absolutely speculative, and you bet against trends in how currencies trade against one another.
Just like with bitcoin.
The difference is that USD, Euro, Yen, etc are all trillion dollar markets, where BTC is measured in millions. The speculative market pushes around the valuation a lot more, and BTC swings a truckload more from trading in its exchange rates than any other currency - changes in the Euro are measured in cents over a year, not in a hundred dollars over 6 months.
I won't argue people are buying BTC to use for exchange right now, though - of course a lot of people are investing in it when it is gaining legitimacy.
It seems like you have more of an issue with the Bitcoin evangelists moreso than Bitcoin itself. I bought a few Bitcoin because I find the idea fascinating and like to see how the system works -- more to be a part of an experiment than to do actual business, but anyone who thinks that Bitcoin is ready right now as an alternative to fiat is out of their mind.
You are probably right. While I am cynical in my judgment of the current state of Bitcoin I am optimistic in the theory as a whole, maybe too much so. I love the idea of a decentralized currency and see it as part of the natural evolution of globalization. Maybe I can afford to lose a little ...
I'm pretty sure that Grade A bonds, CDs, and IRAs, among few others, accounts are the only types of investments that one should consider putting more money then they're willing to loose into.
Bitcoins is a ForEx market, and like any ForEx market, you can lose money, quickly.
Technically speaking, an IRA is just a (brokerage|bank) account with a special tax designation. It won't stop you from putting all your money in a penny stock or out of the money options, for example.
