Bitcoin is currently all the rage. The last few weeks saw an incredible rise in “value” (as seen by the exchange rate), a rise in problems (DDos against MtGox and Security Breaches at Instawallet and Bitcoin-Central) and loads of good and bad articles. Currently, the most important problem though, is another one.
Hyperdeflation. The constant rise of the value of BTC vs “normal” currencies like EUR or USD makes it highly improbable, that people do anything else than hoard their coins. The reasoning is totally clear: The value of the BTC will be higher tomorrow than today, so it doesn’t make sense to use the BTC to actually buy anything. A currency that is not used to actually buy stuff is kind of useless (and not healthy for the whole ecosystem)
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