NEW YORK (TheStreet) -- Bitcoin suffered another setback after China announced the latest section of its Great Bitwall. The virtual coin lost over 50% of value since China began restrictive measures. The Middle Kingdom's largest bitcoin exchange, the BTC China, revealed government regulators are no longer allowing the BTC China to accept new deposits.
The intense bitcoin volatility render it unsuitable as an investment for most people, in my opinion. As I wrote before, it's more hype than reality. If you want to hedge against a falling dollar or have the capability to "bribe border guards" in an emergency, gold, jewelry, and guns make better options.
Apple (AAPL) has shunned bitcoin apps, Amazon (AMZN) and eBay (EBAY) have their own payment virtual currencies they want to promote and outside of online illegal drug transactions, the super techo-geek coin losses utility pretty fast. The only other widely accepted purpose is speculation on the various virtual "bucket shops."
When viewed from this perspective, trading in bitcoins appears remarkably close to a chain letter or pyramid scheme.
I imagine if the Internet existed in 1637 we could have traded tulips online, too. I would wager the peak price would have exceeded the already insane prices at the top because the pool of money from around the world could have pumped it further. Don't think for a moment that we are any smarter than we were almost 400 years ago. In 2011 Molycorp (MCP) and Crocs (CROX) became massively overpriced bubbles. Take a look at the monthly chart for full effect.