[shivak]

His description of Bitcoin is technically incorrect. As described in the original Bitcoin paper, workers are not necessarily "miners" and may be funded by transaction fees.

Bitcoin isn't susceptible to hoarding because, unlike gold, it has no intrinsic value. An alternative explanation for the rise in value: the Bitcoin ecosystem is under heavy development. The value of Bitcoins is possibly soaring in anticipation of this infrastructure i.e. its utility as a currency.

I wouldn't rely on Krugman's blog for serious analysis.

[Robin_Message]

The monetary value of gold is in excess of its intrinsic value — exactly like Bitcoin. It's only a question of degree. And "shiny things" as a motivation for mining explains gold and Bitcoins.

[shivak]

Yes, but the reason why is not exactly the same. That point is lost on Krugman, who equates gold and Bitcoin on that basis.