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Is it worth to invest in Bitcoin in the long term?

I am interested in Bitcoin's popularity in the developed countries. What kind of social group is willing to use bitcoin as currency in their daily life? Do you trust in bitcoin?

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    Dec 22 2013: A year ago a Bitcoin was around $8. Last April it shot up to over $300, causing a lot of excitement, then settled down to around $100. This last month it shot up to over $1000 a Bitcoin, went down to around $400 and now currently sits at $600. So the question "Is it worth it in the long term to invest in Bitcoin?" is tricky. Looking at the past year of activity, I lean more towards "yes", but with the same hesitance that I would've had a year ago. Had I known last year that it would rise to $300, I would've invested every penny. But I also would've certainly withdrawn when it rose to $300, not knowing that it would be $1000 later.

    But overall, as risky as it seems, it's a breath of fresh air when compared to the constant inflation that the dollar has been experiencing this last century.

    The immediate "social group" that comes to mind is the black market. Bitcoin has been a really popular currency for illicit transactions, to the point where some argue that the seizures of major blackmarket sites like Silk Road end up affecting the overall value of Bitcoin.

    But with Bitcoin's recent rise in popularity, and the political efforts of Bitcoin advocates, Bitcoin is gaining traction as a legitimate currency for commerce. Bitcoin is incredibly useful for online commerce, because a lot of countries don't have access to credit cards like Mastercard and Visa. Bitcoin allows direct person-to-person transactions, with no central authority required. Because of this, I expect Bitcoin (and similar currencies) to become very popular over the course of this century.

    Bitcoin relieves us from a host of "Old World" problems - central banks, printing, economic sanctions, etc. And it's clearly paving the way for the next evolution of currency. But no doubt new problems will arise. Also, it's not a currency that we can base our current economy on. Imagine if the dollar underwent the same major fluctuations... it would be chaos.
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      Dec 23 2013: Could you please let me know what causes Bitcoin prices fluctuation?
      Thanks Fred.
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        Dec 23 2013: I'm not sure I can provide a satisfactory answer for that. I haven't looked much into crypto-economics.

        It's certainly worth the study though. You could make quite a bit of money. I recommend checking out bitcoin forums.
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    Dec 30 2013: If you may be interested in knowing more about Bitcoin.

    News- Bitcoin: a digital Puzzle with Currency (30 Dec. 2013)
  • Dec 24 2013: If I may be perfectly honest. To answer that question you should look into the history of bit coin.
    They way I think about it I believe the idea was created by Thomas Edison. Now as much as I appreciate Thomas Edison's ideas and inventions I am afraid to say that the invention of electricity to be mass produced by him was useful, but gave no credit to the discovery made of this electricity done by Tesla.
    There for my fear would be who would be running this data base bitcoin? And while you invest all your money into a database with numbers with nothing tangible to hold on to it would be my fear that all someone would have to do is hack into the system change your account balance to zero, those that possess the tangible cash will be safe from this while the bit coin investors are ruined. But I do not know enough to say this is true. This is just my fear from not understanding fully so I pardon my ignorance and will look into it further. I just thought perhaps these worries would be valid enough to consider before investing.
  • Dec 18 2013: From what I heard, the bitcoin's primary use today is by investors looking to make a buck when its value rises, and criminals that use it for many of the same reasons they prefer cash over credit.

    While I do think digital currency has its place and a bright future, I'm not sure something as unregulated and widely fluctuating as the bitcoin is a direction we want to take.
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      Dec 18 2013: what's wrong with unregulated?
      • Dec 18 2013: The "wildly fluctuating" part is a direct result of the "uregulated" bit. I don't know about you, but I'd like my monetary system to be as stable and predictable as possible.

        Regulation is like most things in life, beneficial in moderation. Too much can be just as bad as too little.
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          Dec 18 2013: it needs a little more elaboration how lack of regulation causes wild fluctuations. i can come up with examples of regulated things wildly fluctuating, and unregulated things being fairly stable.

          on logical level, there are at least two things between the logical chain. the first is the intent. the regulator might want the object not to be stable, and it is pretty much the case with government regulated money. that is why we have inflation in every country on earth. granted, the level of fluctuation is low, but this is not my point. my point is that the regulator could make money more stable, but it just does not want to.

          the second is success. regulator might aim at stability, but it might be incapable of achieving it. we see in great many cases how regulations lead to unwanted consequences, and then the attempted fix leads to yet more of those, leading to a long series of tweaks.

          it is just another case of the recurring pattern: regulators take initiative, fail, and claim success anyway. why we fall for that ploy over and over again?
      • Dec 18 2013: I admit these are questions whose answer requires someone who's more of an economist then I.

        Still, regulation or otherwise, if we're already making the transition, I'd like a system which isn't quite so friendly when it comes use by criminal elements.
        Why can't we just move on to digital forms of traditional currency anyway? Seems like a smoother transition then trying to use bitcoins.
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          Dec 18 2013: certainly we could. the thing is, governments all around the globe do everything in the book to stop alternative currencies. it pretty much rules out any initiatives other than these rouge, totally unowned and decentralized systems.

          this is in fact another example of my earlier claim: governments promise a stable money, and in their effort, they crush stable alternative currencies, thus making bitcoin-like currencies thrive. the exact same thing happened with drugs. or with firearms. they can't effectively ban it, but they can push it into the hands of criminal cartels.
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        Dec 19 2013: Krisztian asked what's wrong with unregulated?

        Political power is a term often evokes fear in the political population consciousness.

        Do you agree about it ?
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          Dec 19 2013: not sure i understand you. in my country, political power does not evoke fear at all. people just want the "right" guy to have it, but somehow, it never turns out good. they keep trying anyway.
      • Dec 19 2013: The difference between money, and things like drugs and firearms, is that with money, the government can fight the phenomena with a workable alternative, which assuming they're competent in their work, will be engineered to preform better in things like stability (though I admit that's a big "if" concerning government competency).

        Though firearms aren't a very good example, as unlike drugs, some countries have managed to regulate them very effectively.
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          Dec 19 2013: it is a difference, yet they are not doing that. government could support alternative moneys, after all, it supports freedom, isn't it? (rhetorical question.) but in fact governments suppress alternative moneys. why is that?
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        Dec 19 2013: Thanks for your sharing. Your point is valuable, Krisztian !
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      Dec 19 2013: Can I move to the other’s angle to think?

      As illegal drugs are offered to users from health centers for free of charge, then, evidence showed that crimes decreased gradually. Why
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        Dec 19 2013: not directly correlated?Many factors(external and internal) can contribute to the decrease.Implications don't always turn out as intended.
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    Dec 17 2013: 我觉得不靠谱,现在通行的纸币其实只是2种,一种和黄金挂钩,很少有国家这么弄了,以前美国是;一种是信用货币,以国家信用为基础发行。比特币2种都不符合,不具备价值,至少没有人对它的价值进行担保,所以我认为是炒作。
    • Dec 18 2013: 短期的应该还可以吧,至少有一小部分人现在已经因为拥有比特币身价高涨。
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    Dec 17 2013: I have just finished this Video.

    The Truth About Bitcoin

    I am still thinking about Bitcoin currency when will be the right time for China.
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    Dec 17 2013: As far as I know wikileaks accept donation in bitcoin and there is a coffee bar in Beijing for startups that accept bitcoin as a currency.

    I would seem it as a social expirement that has potentials to challenge the current banking system(ambitious huh?) while some suspect it would be just another case of Ponzi scheme or the buying of it a speculation.

    2 of my friends purchased several bitcoins 2 years ago not in an attempt to make money but to show support of the concept behind it.