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The Bitcoin Bubble Take 2
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The Bitcoin Bubble Take 2

If you are just now hearing about the new upstart virtual currency called Bitcoin and wondering what the excitement is all about, you are not alone. Many have been speculating about the merits and pitfalls of such a currency scheme such as Bitcoin, but some are just plain speculating, trying to take advantage early in. Despite the fact that its been developing for about 4 years now, people have reservations - and rightly so - about the credibility, stability, viability and usability of such a unique system of currency. And, despite the very recent drastic drop in value, or correction on April 11, 2013, speculation is now focused on the next possible Bitcoin bubble, take 2.

As Gavin Andresen, a lead developer on the Bitcoin project, intones that Bitcoin is an experiment but he think the company has a promising start-up potential, but cautions any investment in time or money as a risky thing that people recognize.

However experimental or risky it seems, Bitcoin is a very cool concept. And its gaining in popularity even in mainstream media, which is hardly surprising, given its lofty ideals. In short, Bitcoin is a virtual currency that anyone can use, anonymously if they wish, on anything that can be bought or sold, provided there are buyers or sellers willing to accept it. Bitcoin is not regulated by government or central bank and not tied to other currency or, theoretically, market manipulation. Cleverly conceived and devised, the system seems to be working well, even despite, and as some might say, because of the recent blip.

Here are a few other thoughts....

Firstly, Bitcoin is not just some unreal digital bits that exist only in cyberspace, created from nothing without any intrinsic value. Just because you can't touch something, it doesn't mean it isn't real or have no value. Bitcoin is a complete currency exchange protocol, that allows for secure and inexpensive transfers of value. All this, done anonymously, across any border and without state interference or meddling. Its not surprising then, to hear the media echo the wall street sentiment of suspicion when there is a correction. Central Bankers and Wall Street Bankers are pretty much in the same game.

To the skeptics and naysayers and those with a vested interest in the present contrived monetary policies, consider the likely-hood of Bitcoin proving to be a viable alternative to the major banks and credit cards, even PayPal and Western Union. The recent correction might just be speculation, as I suspect most Bitcoin collectors might have nothing yet to spend them on or might just be using them as an investment vehicle. The value is bound to change over time, and as more are created and more people start using or investing in them, a new paradigm might just emerge.

Alternative currencies have been tried before, and there are plenty of historical examples of wild speculation gone wrong. However, in contrast to the recent financial meltdowns and all of the damage the so-called austerity IMF debt-repayment programs that are destroying personal wealth in record time, Bitcoin seems very a hopeful alternative.


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