It's a remarkable success, but it won't be the future of money.  Even putting aside security problems -- not surprisingly, a digital currency is a favorite target of hackers -- there’s the potential that Bitcoin will turn from a way of doing anonymous, simple digital transactions and into a speculative-asset investment item, especially if it continues to soar in price. That might promote hoarding of Bitcoins by early adopters and choke off the marketplace. Although transactions haven’t fallen off a cliff yet, a currency whose value is distinctly bubble-tastic is not something that even digital libertarians will readily spend.

Here’s where a state could easily step in by just … printing more money, so that economic activity is not choked off by scarcity or hoarding.