I am of the opinion that the Bit Coin will crash and burn. Yes I’ve been saying it for a couple of years now ever since it was less than 10% of its current value but that does not make me wrong. Of course time will tell but I am thoroughly convinced. The rise of the value of Bit Coin is directly related to speculation and has nothing to do with its intrinsic value which is zero. It is a made-up currency with no basis in value and nothing backing it up.
You may argue that the dollar is basically a made up currency with no value since we left the gold and silver standard. True, however it is backed by the full faith and credit of the government of the United States. Who backs up the Bit Coin? Nobody.
My premise is based upon the Tulip Bulb. Another speculative buy that caused a financial crises in Holland many years ago. The price of a single bulb speculatively increased until it would trade for an exorbitant amount. Suddenly it fell to almost nothing. If you don’t know what I am talking about visit this link http://www.thebubblebubble.com/tulip-mania/ This is a well written explanation of the crises.