In other words, this isn't an investment for the cautious investor, or anyone who doesn't have money they can afford to lose; nobody should feel confident about putting their life savings into bitcoins. On the other hand, if digital currency isn't here to stay, it's nonetheless making a valiant attempt. It's worth noting that there are other cryptocurrencies vying to be the next Bitcoin, notably litecoins (www.litecoins.org) and PPCoins (www.ppcoin.org).
For those who are intrigued, investing cautiously in bitcoins seems the way to go for now. And if you're someone like Harlan Platt, finance professor at Northeastern University's D'Amore-McKim School of Business, you shouldn't touch it at all.
"Bitcoins are a bit like pixie dust, the substance that Tinker Bell used," Platt says. "It only exists if you believe it exists. Unlike formal currencies, there is nothing that stands behind them such as the full faith and credit of the United States government. Like other schemes, though, it is somewhat like musical chairs. As long as you're not the last person to sit down, the game is fun. The last person left holding these instruments only has a story to tell and no value."