Bitcoin bubbles to $100 = Sit back and watch it burst

 

Bitcoin bubbles to $100 = Sit back and watch it burst

02 Apr 2013 11:39 | by Nermin Hajdarbegovic | Filed in Internet

 

The value of Bitcoin surpassed $100 yesterday, on April Fools' Day. The

virtual, uncontrolled currency has gone from strength to strength in recent

months but now it is starting to resemble a massive bubble.

 

Back in January, Bitcoin was trading at just $15 and just a month ago it was

at $35. It doesn't take a degree in economics to realise that something is

very wrong and that it is only a matter of time before something truly nasty

happens. At this rate, you are probably better off investing in Cypriot

banks than in Bitcoins.

 

Multiple businesses and web services have started accepting Bitcoin as

payment over the past few months, but this doesn't justify the spike in

value. In fact, nothing does.

 

Analyst Nick Colas told Business Insider that investors are wary of Bitcoin,

which is hardly surprising given the numbers.

 

"The reaction from clients has been pretty uniform: it must be a bubble. Too

far, too fast, too new . you get the idea.  Moreover, it's very hard to

short Bitcoins, so there's no real way to express that pessimistic point of

view, which is saving a lot of people some real money, since Bitcoin has

some solid momentum just now," he said.

 

If Bitcoin crashes, it wouldn't be the first time. Back in 2011 Bitcoin was

trading at $30, but much of the value was wiped out after multiple hacking

incidents raised questions about security. This time though, the crash could

be much bigger.

 

Read more:

http://news.techeye.net/internet/bitcoin-bubbles-to-100#ixzz2PKsqsKRi

 

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