[garethsprice]

There is a direct and educational correlation that can be drawn between South China Seas, tulip bulbs, stocks in 1929, dotcom stocks, Beanie Babies, subprime housing, Bitcoin, etc.

Time and time again some financial instrument has become unmoored from it's intrinsic value and lax regulation allows speculative money to pour in, some early adopters get rich, the financially naive jump on the bandwagon without understanding the underlying instruments, they get spooked and the entire thing plummets back to it's fundamental value (which may well be zero) leaving some with fortunes and some with nothing. Bubbles appear to be a natural occurrence in a lightly regulated market economy and typically follow a very similar pattern.

I think that Bitcoin can be both a speculative bubble and a potentially world-changing technology. The dotcom bubble is a fine prior example - huge classic speculative bubble, also radically changed how we are all now living.