I don’t know if Bitcoins will be a wise investment in time or not, but I felt I needed to chime in to correct some unfortunate perceptions. Mainly, that Federal Reserve backing or government backing is needed or even desirable. The main POINT behind Bitcoin is that it is a decentralized digital currency. It neither needs nor desires government or Fed backing in anyway.
It is in fact, an expected course of action for governments to attempt to make illegal a currency that they cannot control, even though the U.S. Constitution has no problem with non-government currencies, and in fact, several founders and key historical American figures vehemently opposed central banks such as the Federal Reserve. Andrew Jackson fought loudly against (and defeated) the central bankers in his time, only to have his likeness printed upon our current central bank “funny money”.
The Federal Reserve is no more Federal than Federal Express. It does not work for the American People. It works for a group of private bankers. Our money has no real backing anymore since Nixon detached it from the gold standard. It is less “real” than Bitcoins are. Producing Bitcoins at least requires work and there are a limited supply of them. Federal Reserve Notes can be made “out of thin air” by banks at the time of any loan or mortgage. That’s a funny thought considering that most of us work for 30 years to pay off what is mostly an illusion made only on paper. But its true and research will confirm this.
Furthermore, I think its unfair to stereotype BitCoin as the currency for illicit and trendy warez. Traders in illicit warez will of course gravitate to less traceable methods of payment. I assure you cash is still king here. And since BitCoin is still young, by definition those establishments which accept it are going to be seen as “trendy” because its still a novel method of payment, but this will change in time, of course.
That said I agree that land and food are far more useful and real than any monetary unit, physical or electronic.