Whether bitcoin meets an early demise or not, there are certainly those out there who wouldn't mind giving it a little nudge towards the grave. I'm not talking about Prof. Bitcorn either who probably regrets now what he said. The anti-bitcoin publicity drive was kicked into high gear by the Mt. Gox collapse and has been relentless ever since. The proof point always is "Look at what happened to Mt. Gox."--it has become the poster child for why bitcoin is too scary for ordinary investors.
Prof Bitcorn may regret having given a specific date, but he has been interviewed recently and still stands by his "under 10$" prediction. His arguments are still valid.
Negative articles these days do not mention MtGOX as much as the 60% loss of value over this year. For most investors, that is a very good reason to stay away from bitcoin.
What is more disturbing to rational investors is that the bitcoin supporters and recognized bitcoin experts cannot provide a good explanation for why it surged 10x in 2013-11, why it has been falling through most of this year, why it had a modest recovery starting 2014-05-20, and why one should expect it to rise again in the future.
I have my partial explanation for the first two. China had a huge number of amateur commodity speculators, and they switched to trading bitcoin when the Mainland exchanges opened in Beijing and gave them access to that market. But they have been dropping out it since the PBoC reduced it to a bad gambling game. (Because of the constant mining output, day-trading in bitcoin is a negative-sum game: the majority of traders must lose money, and the longer they trade, the more money they lose.)
You won't find this explanation being aired in the bitcoin media like Coindesk, or offered by bitcoin gurus like Andreessen or Antonopoulos, because it is very bad for marketing. "By investing your life savings in our bitcoin fund, you will be placing your future in the hands of an army of amateur day-traders in China, who have no idea of what the blockchain is, and couldn't care less about it." Sure, why not?
After a year, the only article that has looked into the demographics of the Chinese bitcoiners was published in (of all places!) the Chritian Science Monitor:
http://www.csmonitor.com/World/Asia-Pacific/2013/1206/Why-the-Chinese-can-t-get-enough-of-Bitcoin-despite-bank-banThe bitcoin press much prefers to "explain" the price of bitcoin by ridiculous technical analysis, like that linear extrapolation of the logscale plot (which has been rather absent of late, since it now only shows that the extrapolation does not work any more).
Anyone blind to the risk involved should not be speculating in bitcoin. I'm no trader, but markets do fluctuate, and often for some very obscure reasons. The only strategy that makes any sense is to hold bitcoins for longer than 5 years. If you believe over time that its growth will be logarithmic, then that's the safest way to avoid getting caught up in a down trend as we've seen during 2014. It's kind of like California real estate--it goes up and it goes down, but has been rising overall for 150 years.
I still have found no explanation for the modest bubble that started on 2014-05-20. I also do not see any reason to expect another bubble in the future, that would push the price higher than the 2013-11 one. In my understanding, that would require the opening of a new market, even bigger (in terms of disposable money) than the mainland Chinese speculators. Where would that market be?
The market is there all right, especially with the expansion of mobile point of sale (MPOS) we've seen. It accounts for much of the success of companies such as Square. Everyone is carrying around their iPhone, iPad, Android phone or tablet, or MS Blu. MPOS is a very convenient way to transact business. Bitcoin is a natural to take over a share of this business, especially in unbanked parts of the world such as the developing Asian countries, for example Myanmar and Bangladesh. Of course, there are a few wee problems such as the Government of Bangladesh having banned bitcoin, but eventually they may have to relent on their negative position. My only concern is that bitcoin developers will not jump on the opportunity fast enough to develop mobile applications for making international remittances in settlement of trade. I'm a little disappointed that JADA, Kraken and crew, who seem to be taking over what's left of Mt. Gox have not announced taking some greater initiative in this direction. If Japan truly hopes to become the most "bitcoin friendly country", hopefully for their sake, they'll kick this up into high gear.
BTW, another explanation for the downtrend in 2014 bitcoin price levels is that it could coincide with the liquidation of the "missing" Mt. Gox bitcoins. I've watched this market enough to realize that every time it starts to gain a little momentum, along comes another massive dump of bitcoins on the open market. There must be a few large holders doing this, and the downtrend is consistent with the distribution phase of liquidating a very large holding.
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