The value of the electronic currency Bitcoin is creeping back toward $1,000 again.People keep describing this price behavior as "crazy" and "insane," but it's actually not that surprising.Earlier this spring, when Bitcoin was trading at about $90, I " raised my Bitcoin target" to $400.This was an inside joke that referenced an old price target of mine.I don't actually have a Bitcoin target.But I was getting at a more profound point: $400 is a perfectly reasonable target for Bitcoin.As is $10,000 or $100,000 or $1 million.Related: Bitcoin's Price Swings Threaten Its Chance of Being a Real CurrencyThis is because Bitcoin has no intrinsic or determinable value.Bitcoin's adherents refer to it as a "store of value," but Bitcoin is only a "store of value" because, right now its price keeps going up.Unlike gold or dollars or other things that have widely accepted utility, Bitcoin's price is currently determined entirely by what someone else is willing to pay for it.Right now, because Bitcoin's price is going up, and Bitcoin is in relatively short supply, people are willing to pay almost $1,000 for it.

And the ever-increasing demand for Bitcoin will keep driving the price up until people don't want to buy or hold it anymore.At that point, by the way, unless Bitcoin has become widely accepted as a legal means of exchange (as "money"), the price of Bitcoin will collapse.And anyone who thinks the price of Bitcoin can't collapse all the way to zero is delusional.I have written extensively about Bitcoin.I have explained that Bitcoin is actually fulfilling a need for a new kind of currency, one that is as anonymous as cash but can be instantly transferred with no cost, hassle, or taxes anywhere in the world.I have explained why Bitcoin is the perfect asset for a bubble.bitcoin zerohedge(Because there is no real way to value it.)I have explained why Bitcoin speculators are just laughing at everyone who thinks they are idiots for buying Bitcoin.bitcoin com boleto

(Because Bitcoin's price could theoretically rise 1,000%, 10,000%, 100,000%, or more, whereas the most you can lose on your Bitcoin investment is 100%)And I have explained that Bitcoin prices could go "vastly higher from here."(I first said this when Bitcoin was $90.It's just as true today.)I also think the odds are that Bitcoin will probably prove to be a gigantic bubble, like Beanie Babies, Pogs, or, yes, tulip bulbs.bitcoin chat protocolBitcoin has all the hallmarks of bubbles, including:I have also described some of the major risks that could break the Bitcoin spell and lead to a price collapse.ethereum jpyThe biggest of these, I think, is that Bitcoin won't ever become widely accepted as a means of exchange — either because governments ban it or because it remains complicated and shadowy.bitcoin als etf

(One of the biggest advantages of "dollars" is that they are accepted everywhere and are extremely easy to use.Bitcoin isn't.)I do think the world is ready for a simple, global, electronic currency, and that Bitcoin has a shot at becoming that.But this success is the farthest thing from guaranteed.Having said that, I want to be clear about something: In the months and years before we know the ultimate fate of Bitcoin, the price could do absolutely anything.ethereum 64 bitThere is no limit to the price that Bitcoin could attain.There is no theoretical difference between a price of $1 per Bitcoin and $1 million per Bitcoin.The only thing that will determine Bitcoin prices is what people are willing to pay for Bitcoins.And if enthusiasm about Bitcoin continues to move beyond a small group of digerati, cryptologists, and hard-money fanatics, Bitcoin's price could go vastly higher.It is reasonable to think that Bitcoin's price could go to $1 million or more.

That's not a prediction.It's just a fact.(I have no idea what Bitcoin prices are going to do.I also don't own Bitcoin, so I don't care what the price does.And I'm certainly not "encouraging speculation."I couldn't care less whether you buy or don't buy Bitcoin.)So, yes, Bitcoin is probably a gigantic bubble that will leave its early religious devotees looking and feeling like fools.But in the meantime, Bitcoin could make people dynastically rich.Because the price of Bitcoin could go all the way to $1 million or more, just as it could go (back) to $0.01.Tell Us What You Think!And don't forget to follow us on Twitter and Facebook!More from The Daily TickerStocks Are Headed Even Higher: Michael HollandAbolish Tipping to Eliminate the $2.13 Minimum WageHow Three 20-Somethings Can Help Obama Fix HealthCare.govHow to Never Pay Full Price for Anything --Ever AgainBitcoin is trading about 55% below its record high and Its biggest exchange is now bankrupt following a multimillion-dollar loss.Does the popular virtual currency have a future?Marc Andreessen, the founder of Netscape, thinks so.

The co-founder and partner of venture capital firm Andreessen Horowitz has invested about $50 million in bitcoin-related companies and plans to invest hundreds of millions of dollars more according to The Wall Street Journal.Related: Car chases, bankruptcy, hackers: What's next for bitcoin?Andreessen has invested $25 million in Coinbase, which creates digital wallets, and smaller sums in Ripple, a payment system as well as other bitcoin-related companies, according to The Journal."Thereappears to be some need for a digital currency that crosses borders that anybody in any country at anytime can exchange...with low transaction costs [and] can then be picked up anywhere else in the world," says The Daily Ticker's Henry Blodget, about the potential demand for virtual currencies.Related: Stakes rise for bitcoin backers as hackers attackAndreessen is betting on it.He expects more Internet users will use virtual currencies in the future, to transfer digital contracts, signatures and money because the costs will be less than doing the same transactions through banks and credit card companies."Andreessen