Didn't Bitcoin crash some time ago? There's no government to back it up. If our US dollars starts crashing, again, our Reserve will start buying more Us Bonds. Come to think of it, that's what's going on now.
Bitcoin hasnt crashed, but it is not as big as it once was. There have been plenty of fraudulent situations surrounding bitcoin. Bitcoin will fail and the one that will succeed will be a currency controlled by the banks. Bitcoin is a teaser of whats to come.
"It's value isn't based on anything". Neither is the dollar" Exactly. crypto-currency and paper currency are in the same shaky boat at the moment which is why I wouldn't class them as a commodity. It isn't a tangible asset to be held in your hand with any intrinsic worth in tradeable value.
I think that crypto currencies are not very trustworthy, at least I have a hard time realizing how can someone invest in a currency that in the next days could have dropped 50%, I would not do it.
It has crashed before don't forget. Although as you say, I think it's just a teaser of whats to come really.
I don't think bitcoin is going to fail, I think it will start slowly rising again and settle at around $800 dollars for a while. Banks are going to try and create their own cryptocurrencies, but I don't think they will be able to succeed Bitcoin.
I just want to point out that Bitcoins aren't the only cryptocurrencies. A large number of people have bought Litecoin, Dogecoin, Darkcoin, and other currencies that I can't think of off the top of my head. If you do some research and know exactly what you're doing, there's huge potential for profit here.
A currency backed by...nothing. Rampant theft and poor checks and balances. The only companies who take it usually take it through an intermediary that immediately turns the coins into fiat money. One of the biggest traders out of business due to a relatively simple coding error that results in hundreds of thousands of dollars leaking out over years. Really the biggest use for it that I saw was for black market materials and drugs. I think I'll pass, thank you very much.
