"Bitcoin painful to sell" and "tulipmania" are completely nonsensical talking points of the anti-bitcoin trolls who haven't actually tried it and are butthurt they didn't get into it.

I've bought and sold more than $100k worth of bitcoin on two different exchanges, and at no point was it painful. It's infinitely easier than buying $100k worth of foreign currency, not to mention it's illegal to carry that much cash in most states.

It's easy to buy and sell $100k of foreign currency on exchanges. Hell, you can open a spread-betting account and 'trade' with massive leverage, so you can effectively be buying & selling most world currencies without even having to pony up the bulk of the cash.

(Not saying that it's a wise idea to start doing this, just that it is possible and easy to do).

In which states is it illegal to carry $100K in cash?

i've sold some bitcoin for much more than i paid for it. i guarantee you, it wasn't painful.

i have no thoughts on etherium. i guess 12M is a lot of dollars, but it's within an order of magnitude of the daily BTC volume. maybe if one guy used 12M worth of BTC to buy this, i'd share your suspicion.

I think, again like patio11, I need to write my own blog post on this to get my thoughts straight and valid.

I guess my point is that a "normal" currency is used primarily within one country for all manner of "normal" transactions, and yet has a liquid exchange market where people want to trade with members of this currency.

Bitcoin has some issues in this regard - half of all BTC transactions in 2013 were on one gambling site, I honestly don't know what the total trade value is not the total exchange liquidity / value but my "feel" is people are either staying in currency or cashing out.

As for buying a new appreciation asset with the profits on my last appreciation asset - well, Ethereum feels like a bubble feeding another bubble, no matter what it's inherent properties might be.

But like I said I am getting upvotes and downvotes all Over this issue and should back out and go do more research

just fyi, i upvoted you because your post looks rational, and thought out. please dont let these downvotes lead you to think all bitcoiners are nuts. we're just as full of partisans as any other group :-/

To be fair, Ethereum is not strictly a cryptocurrency, in the sense that its exclusive purpose is not payments. Sure, coins will have value convertible to fiat currency, but that value will be derived from cost of various applications built on the protocol. The primary purpose of Ether is to be the "fuel" for these applications.

So, high interest in the crowd sale likely derives not from speculation on the value of ether/USD exchange rates, but rather on the value of the cash flow across the many applications being developed on the protocol. As long as developers build these applications, people use them, and they facilitate money changing hands in the form of Ethers, then each Ether will have a set value. Unlike with Bitcoin, consumers will also have a reason to spend Ethers, as they will be the only accepted exchange mechanism of Ethereum applications.

Encouragingly, this will likely act as a self fulfilling prophecy. Investors in Ethereum are motivated to see the ecosystem of decentralized apps develop, so they will build them, and they will use their Ethers. The big problem I could foresee is that because the real value of an Ether will derive from the aggregate value of the Ether "app economy," investors may want to wait before spending their Ethers. But I suspect this will be mitigated by the fact that the apps will only accept Ether as payment.

Ethereum will be successful as a protocol once it gets its "killer app." At that point, there will be no turning back and the value will skyrocket. Surely the market cap will be more than $12.7mm. In fact, by writing this comment I've just convinced myself to invest.

> To be fair, Ethereum is not strictly a cryptocurrency, in the sense that its exclusive purpose is not payments.

Payments is not the exclusive purpose of Bitcoin either. Bitcoin supports things like contracts (https://en.bitcoin.it/wiki/Contracts), via its transaction script.

Bitcoin is essentially a distributed timestamp database, where the storage cost is denominated in bitcoins. This has a tremendous amount of uses.

Granted, Ethereum can do a lot more via its "script", which makes it both more powerful and harder to implement.

I also am thinking of investing but this pre-sale is not the time. They are creating and distributing 1/3 of the ether from the pre-sale to the development team (along with the proceeds from the sale itself, so they in essence get to have their cake and eat it, too). Then they are creating another 1/3 of the ether from the pre-sale and giving it to the miners.

The "fuel" used is going to be a fart in the wind, since it is setup like a bidding process so the transaction goes to miner willing to accept the least amount of ether per clock cycle to run the contract. Since these contracts are going to contain at most maybe thousands of instructions, the expense is going to be extremely small.

So at launch, unless there is some "killer app" from day one, or they are able to generate more hype then they are right now, there won't be any buyers (anyone who was interested in the protocol would probably have bought at the pre-sale) and some major selling pressure from the miners and the ether distributed to the development team.

> as they will be the only accepted exchange mechanism of Ethereum applications.

So if it is successful, there will be an immense potential in cloning the applications and provide alternative means of payment overlaid on an "Ethereum2".

The fear of clones diminishing the value of Ethereum seems odd to me, considering we have many alt coins that are derived from BTC but none have come close to supplanting BTC. Once the technology is openly available it might be easy to spool up a clone, but then marketing and gaining mindshare are needed and they are much more difficult.

On the other hand, Bitcoin had a couple years before any real clones sprung up of it. Ethereum will have clones on launch day.

Marketing and mindshare do come into play, but Ethereum is facing different dynamics.

And if i undestand this correctly, a "clone" could simply have better exclusive app deals.

> It's another bitcoin like tulip mania

Did you know the tulips in question were a fascinating breakthrough in genetic engineering? Just one of the many things you don't know about the myth called Tulipmania. I suggest reading the WP article, especially the parts about tulip-breaking virus and the latter half: https://en.wikipedia.org/wiki/Tulipomania

The tulip mania actually never existed. Look it up on Wikipedia.

More specifically: http://en.wikipedia.org/wiki/Tulip_mania#Modern_views