You guys clearly all have vested interest in Bitcoin, this is the hornets nest after all. I am heavily invested in Bitcoin, but I see it for what it is.
It is a Pyramid, the price is determined by miners and the mining manufacturers who produce the hardware at a set cost. When you purchase that hardware, that is your "buy-in" price. From the time you purchase that hardware, you are unlikely to see a ROI, unless you are lucky. The Manufacturers mine with your hardware for a few months until ROI is no longer possible and blame it on delays, the Manufacturers then begin producing the next wave of machines with 3-10x the amount of hashing power. For the 90% of people who get their machines and start running into ROI problems, they begin hoarding all the coins they have mined, as if they were to sell them they would be selling at a loss. They hoard them in hopes the price will go up, as the entire network of consumers who does this occurs, there is less Bitcoins on the exchanges for sale. Less demand --> higher prices. All it takes is a wift of good news at these points and you will see the 20-90x increase hills that have happened time and time again. This process usually occurs in 4-8 month periods.
Also, every time a bitcoin is sold on the exchange, that is passing the "floor buy in price" of one coin, or the bags so to speak, this means more hoarders for the market, less supply of Bitcoins for sale, leads to higher demand --> higher prices. People are less likely to sell their coins for less than that price, and tend to wait until they see huge gains afterwards before they are happy enough to sell.
We are on the cusp of the next huge increase in price, it will occur within the next 2-3 months, the manufacturers have mined the crap out of all their pre sales, and have finally began to ship all of their units within the past few weeks give or take (and 90% of them will not see a ROI, go work it out), that is until the price of Bitcoin will go up, which I have no doubt it will. They have began manufacturing the next wave of high hash rate ASICS that will come onto the network as they come off the production lines, in the next 2-3 months the difficulty will make bitcoin unprofitable, that event will trigger the hoarding, and you will see the price catapult as a result.
People 'buy in' to the idea that the Bitcoin protocol is amazing and will be the future. This is the source of new money coming into the market, however it does not fully determine the price as I explained earlier, you probably only need a fraction of % to maintain that 11 bn market cap. When the institutional funds come online in June/July and come to buy earlier adopters/whales coins, that will be a good thing for the price as there won't be 500million+ $ worth of BTC dumped onto the exchanges when someone decides they want to cash out.
When the dollar was created, it was done the same way Bitcoin was today, the pyramid is on the damn US dollar bill.
After the price surges, a new wave of bagholders comes to the party, looking to get in on it and make a new fortune.
If left unchecked, Bitcoin will swallow up all of the worlds wealth, at that point it will become a world currency, as there will be no need convert it to dollars and back.
If it gets to the point where there is not enough interest and purchase power, then it will collapse at some point in the future, but this is not for a long time, I'd give it at least another 3-5 years of life. It will succeed if it turns out that the powers that be are behind it, if the whole world buys into it, then it will never collapse, and become the world currency, like I said earlier.
This is something the NWO has been pushing for a long time, Bitcoin was created by an NSA scientist.
The clueless regulators are just normal people trying to do their jobs. What better way to push a NWO one world currency than by letting the people do it themselves, over the internet.
It will wipe out all of the worlds debts, and people holding large sums of nations currency will lose out, like China who owns nearly all of USA's debt/$'s.
You don't have to believe my opinion on the NWO theory, but believe that the price is driven by a pyramid.
