The same here. The whole concept is actually rather complicated, because one needs to understand and know (at least on a basic level):
IT, math, psychology, history and finance. Most people don't, specially the usually younger people who makes up most of the bitcoin fans.
Sure the algorithm is clever, the security is there, but the creators forgot about history and psychology. After all we are human... Original distribution was bad (meaning very concentrated) and they didn't count on that its sudden popularity can actually kill the concept by eventually scaring people away from it because its high volatility.
A highly volatile, scarce, concentrated and hoarded (not circulated) money can not function as currency. End of story...
And actually there are design problems in the system. Monetary-wise, it is badly designed. Here is a good article explaining some of the faults:
http://www.slate.com/articles/news_...heme_the_internet_currency_will_collapse.html
"Felix Salmon and many others have pointed out that a currency cannot succeed with a supply that is fixed, or if it grows too slowly. A currency is used to enter transactions; the more transactions there are, the more of the money you need. As the economy grows, a fixed-supply currency becomes worth more in terms of goods and services, and people begin to hoard itâexpecting that if they wait a little longer, they will be able to buy more. Once hoarding takes over, circulation ends, and with it the function of the currency. Hoarding accounts for the large increase in the value of bitcoins; hoarding also sank Krugmanâs baby-sitting scrip."
Here is my long term prediction. BTC will go the way of the penny stock. After the next real big crash, people will get burnt so badly, that they will stay away from the coins and there will be newer and better systems. The faithful still will buy and hoard it and it will trade at 5 cents level with an occasional quick runup, because people will remember the days when it sold over $200 per coin...
