Bitcoins, and the anime [C]

I recently read this article:
http://www.theregister.co.uk/2011/06/19/bitcoin_values_collapse_again/

This basically sums up what I think about bitcoins:
http://forums.theregister.co.uk/post/1097057

For some reason, after reading the article, and the comments by users on the article, the [C] anime series made a lot more sense to me. I'm not exactly sure why. There seems to be a lot of stuff in [C] that can be applied to the stupidity/greediness of some Bitcoin users.

A lot of bitcoin users just seem to be hacker-types that aren't fully aware of how currency works. Even I'm a bit confused about the whole bitcoin thing, and I'm no financial advisor, but it really does boil down to "trusting" in the currency so it retains some sort of value.

The topic of money/currency/philosophy can get pretty deep, and I'm not even sure how to put some of my thoughts into words, and I'm betting not many people will bother replying to this, but just wanted to attempt to put some of my thoughts out there.

Never seen that anime.

As for a currency. Yes, that's exactly how every currency works. Collectively, people trust in it, and so it has value.

Bitcoin has a few issues inherently setting it back. The number of people that use it, accept it. The security of the currency is pretty paramount as well.

Don't forget that Bitcoin issuance is based on trust.

A slippery slope, the chain of trust can deceive and warp.

Too much of a gambit for this man, although I'm sure someone has an angle on this.

Even after reading this, I have no idea what bitcoins are.

Try Wikipedia. And maybe work on reading comprehension.

Well from what I read, bitcoins are a sort of virtual currency which you can exchange for real currency (probably for a ridiculous rate). The thing is, your computer should 'generate' them over a span of time, so then because computers have to make them, it's 'effort' get translated in real worth. Seems like it's going to be real time consuming to get any money out of it.

Though I'm not an expert in economics. Not even close.

It's a currency that sets a finite money supply to eliminate inflation.

Computers generate the currency by solving the cryptography blocks, each one getting progressively more difficult and requiring more computing power. When it hits the final sum of money, there's no more payout for solving the blocks. So instead, transactions requiring the blocks will essentially offer bitcoin rewards for people who help solve the blocks.

The idea is that by controlling money supply and essentially limiting the velocity of the money (the amount of times each bitcoin gets used) then inflation is controlled and amounts to zero.

It's more of a commodity then a currency at this point. Endgame for most is the liquidity back to real money. Government regulation is just a matter of time.