okay i grant you all that bitcoin is something special. i guess i just don't see how the value inputs work if its value against fiat is insignificant.

i don't see the _bridge_, and i don't think that this is a flawed perspective, no matter how cool bitcoin is.

the answer is only no because i would be hoping that someone would figure out the new fiat value conversion problem, someday, and because storage of them costs me nothing.

The Casascius physical bitcoins and the Bitcoin Magazine have been the top sellers so far!

you really have to address the "if you don't hold it, you don't own it" idea.

if you alone have the private keys - you hold it. fullstop.

unlike gold certificates. precious metals are substituted with paper very easily because they are hard to use in actual transactions. bitcoin overcomes this barrier because they are made to transact.

You are viewing Bitcoin as if it fits into a classical economic model. It doesn’t. There will always exist a strong general tendency towards equilibrium in any economy but liquidity (in the form of stable price) isn’t necessary for an e-currency to survive because a national economy does not rely on it.

Good example but where/how you get hold of bitcoins assuming you can't mine/earn them yourself? Unless you expect salaries to be paid out in BTC, which is not any time soon I guess
To continue with your example... Let's assume I have two options for bed and breakfast
1) pay 10BTC
2) pay 50EUR
Assuming I don't have any BTC since my salary is in EUR and I don't mine either, I would need to exchange EUR for BTC. If the price for 1BTC was close to 8EUR i would pick the second (cheaper) option and pay in EUR. If the price for 1BTC was close to 3BTC I would pick the first option.
Convert your example to a vendor and client situation and you'll see that the stability of a currency has a strong influence in adoption.

We can NOT skip the comparison of BTC to fiat currencies as we're some 20-30 years away from the time that most transaction will be in bitcoins instead of fiat. And to get there we need people to start using it. A vendor accepting (now) BTC has to make the comparison since he can't pay all of his suppliers/costs in BTC. I client has to make the comparison since he's not getting his salary in BTC. If both have to check daily (or worse twice a day) the rate, they'll abandon the whole idea cause it will be too much of a hassle. And since the value that bitcoin has is how many people want to use it, you know what will happen if fewer and fewer people want to use it (as per the example above).

And unfortunately there is no magic switch from some-people-use-BTC to most-people-use-BTC in global scale. When we get to the point when EVERYONE uses bitcoins, then you're right! There is no volatility, but how do you suggest we get there without a fair price stability?

I agree with the OP, take a look at my post some days ago...
https://bitcointalk.org/index.php?topic=102184.msg1122874#msg1122874

+1
It's Fight Club! I always imagine the commenters to be a roomful of Max Keisers but without morals. One thought I had was making the article into a dialogue -- even a fictional "Bitcoin versus Krugman" shakedown of Fractional Reserve. Where's Matthew N. Wright when you need him??

To the OP acoindr: it's a great start, and don't feel bad when people start ripping the draft to pieces. It's always easier to improve upon something than to lay the foundations yourself.

Great!  There's a lot of good material on the forum on the Bitcoin/Gold relationship, unfortunately it's dispersed across many threads (e.g. https://bitcointalk.org/index.php?topic=100065.0), but hopefully it can be used as a starting point.  There's some very sharp Bitcoin-loving gold writers (e.g. Trace Meyer) who might be able to help out as well.  Not sure if Bitcoin Magazine has or is planning an article on the topic also, would be good to see one, and perhaps that could be leveraged onto ZeroHedge or viceversa, possibly whatever you write could also be published on the magazine.

Thank you again for taking the initiative to get something done on the ZeroHedge front!

Don't worry, we've got 3 of the bitcoin polo shirts from CryptoAnarchy.us that we will be wearing tomorrow and Sunday. We've also got Alison's sister in the booth.  There won't be any doubt that bitcoin is here.

Maybe I can help explain what the OP Is getting at, because I do think he has a valid point.

One of the aspects of bitcoin that is temporarily discouraging to merchants is volatility in the price, which translates to currency risk. Over time as the user base grows I believe this will be less and less of a problem.

But what if the Fed wanted to cause some mischief by alternately buying up some large percentage of the available bitcoins and dumping them back on the market? It would induce more volatility in the price than there would be otherwise. Sure, it might cost them money every time they do this. Sure, they will probably not be able to sell them for what they paid. But they wouldn't care: they are the Fed, and they can print as much as they want. The point would be to induce the volatility and discourage or suppress the adoption rate of bitcoin.

And yes, I think they could do it a few times, until we all caught on to their game and started riding the wave.

Thank you for taking the initiative to get Bitcoin on ZeroHedge.  Some thoughts:

A large portion of the audience (or at least the commenters) are cynical goldbugs and preppers.  Although an article introducing Bitcoin might work fine on less ideological audiences, I think that you might be more successful if you do a more ambitious two or three-part offering (or 3-section article)  that, aside from introducing Bitcoin, also addresses up front the two main objections and misconceptions likely to come up from the commenter crowd.

1. Bitcoin vs. Gold
Explaining how they complement each other, why both are necessary under different scenarios like border crossings, confiscation resilience of Bitcoin versus gold, how the stupid objections to gold ('you can't eat it') also apply to Bitcoin and vice versa, pointing to George Selgin's work which correctly classifies Bitcoin as a new type of commodity.

2. Bitcoin in a Mad-Max no-electricity no-Internet scenario.
Check out the article "Bitcoin Under the Worst Possible Conditions" from the first issue of Bitcoin Magazine. The possibility of resilient peer-to-peer mesh networks.  Barter usage via Casascius gold/silver/bitcoin hybrid coins, Bitcoin paper bills, paper wallets, and other no-electricity physical bridges.  Etcetera.

But to be clear about these suggestions, even if you ignore or disagree with them, I'll still be grateful, any article will be better than no article.

We have the bitcoin banner ON STAGE with all of the concerts and speakers.  That gets alot more eyeballs than our 10x10 booth

I have a ZeroHedge account, but have never used it to submit an article

I will look into it

It's worth a shot, but don't be surprised if they don't publish it or shoot it down completely  

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Betting on Bitcoin

Word is getting out on bitcoins, a potentially world changing currency. By now many in tech circles have heard of Bitcoin, but still relatively few really know all about it. There isn't one easy-to-understand all encompassing guide. This results in misconceptions about Bitcoin which is complex, being both a currency and payment network for that currrency. To fully appreciate Bitcoin one really needs a good understanding of math, cryptography, computer networking, programming, economics, and the nature of "money". In light of that it's no wonder this open-source project is sometimes erroneously summed up as a "Ponzi scheme".

Still, many people around the world are betting Bitcoin will be around in the future. The bitcoin/dollar exchange rate has gone from a few cents in 2009 when Bitcoin started to over $10 per coin as of August 2012.

To answer what exactly Bitcoin is it's helpful to know several key things:

1. Bitcoin is not controlled by any central authority; it's completely decentralized
2. Bitcoins come into existence (as defined by the protocol, which everyone agrees to by using) through a process called "mining" which involves using a computer to solve a problem of varying difficulty
3. There will only ever be 21 million bitcoins generated; the problem difficulty is adjusted automatically so bitcoin creation follows a fairly stable and known inflation rate [1]
4. Bitcoins can be subdivided to 8 decimal places
5. Bitcoins obtain a value because people want them for different reasons, and they are scarce (the same way gold obtains value)
6. Bitcoins, if used properly, can provide anonymity for their use
7. Bitcoins can be used to transfer any amount of value around the world, almost instantly, by anyone, with little or no cost
8. The Bitcoin code has been reviewed by many qualified experts (it's open-source) and serious flaws, in terms of bugs, have yet to be found
9. It's unlikely any entity, such as a government, could entirely prevent the use or growth of Bitcoin without shutting down the entire Internet

With those qualities one may begin to understand the potential Bitcoin brings, but who is supposed to use it and how?

Bitcoin draws to it anyone wanting payment freedom. Bitcoin accounts can't be frozen, and anonymous payments are possible if precautions are taken. Bitcoins are also a global currency, so while their legal status is now in a gray area, should they ever be outlawed somewhere it wouldn't mean they were outlawed everywhere; that would put pressure on regimes doing the outlawing. 

More specifically, some Bitcoin users might be described as libertarian minded. Many of Bitcoin's proponents have even been called the digital equivalent of "gold bugs" because bitcoins work similar to gold as currency since they can't be arbitrarily inflated.

While it may not be easy to understand bitcoins, it's straightforward to use them. All that's needed is a standard computer and Internet connection to download freely available "wallet" software from sources like bitcoin.org. Wallets use cryptographic keypairs, consisting of a public and private key, for account addresses (e.g. 175tWpb8K1S7NmH4Zx6rewF9WQrcZv245W) allowing users to send coins to one another almost instantly. Ease of use is compared to sending email.

There are several ways to obtain bitcoins, including buying them, working or trading for them, or "mining" them. Mining is the term used to describe using a computer to solve the computational problem first and winning bitcoins, thereby bringing them into existence. Anyone can mine for bitcoins using software that is also freely available, but competition is now high. For many people it's easiest to buy bitcoins.

Bitcoins are now exchanged 24/7 for all sorts of things as would be expected of any currency. The web page at https://en.bitcoin.it/wiki/Trade gives an idea of the type and variety of available goods and services there are for bitcoins.

As word continues to spread about bitcoins, and their adoption grows there is a good chance their value will continue to rise - not just compared to fiat currency, but also for the variety of things for which they are accepted. That probably makes bitcoins a very good bet.

[1] https://en.bitcoin.it/wiki/File:Total_bitcoins_over_time_graph.png

I'll drink to that!

That's awesome.