Posted on Leave a comment

Are Bitcoins the Next Great Investment?

Bitcoins graphic Recently, we’ve received calls on our MoneyWise radio program wanting to know about Bitcoins and asking our advice about investing in them.

 

Bitcoins is a payment system that was invented in 2009 by Satoshi Nakamoto. Essentially, it is digital currency that operated outside of governments and the traditional financial system. The US Treasury calls it a “virtual currency.”

 

From my point of view, it’s too risky to invest in them. And some of those connected with this payment system have been involved in questionable activities. The founder was sent to jail, and the Bitcoin Exchange is bankrupt. And if that’s not enough, the founder of the largest of the Bitcoin exchanges was arrested just recently. I don’t know the details, but it may have something to do with the $400 million in Bitcoins that are missing from the company’s accounts.

 

Investing in Bitcoins is still confusing to me which also violates this important investing rule of thumb: If you don’t understand a potential investment well enough to explain it simply and clearly to your spouse in a way that he or she understands it – don’t do it!