re: Bitcoin is a Ponzi scheme—the Internet’s favorite currency will collapse.

I disagree actually. I believe there is more than enough demand for some type of currency or unit of exchange that has anonymity has a feature. Between black market businesses, of which only a small fraction is currently using bitcoin, and all the naive anarchist idealists, I think there's more than enough base demand to support the continued use and development of anonymous crypto-currencies. I mean the desires of huge numbers of individuals to hide money from governments is not going anywhere, and any objective person can see that digital, anonymous currencies have massive advantages over cash. Perhaps not now, but I have no doubt they will in the future.

And it really doesn't matter that bitcoin is a ponzi scheme. Eventually the price will collapse, they speculators will abandon ship, and it will begin to function as a currency. Someone will figure out a way to develop a new version that isnt a ponzi scheme. And besides, the value of future crypto-"currencies" is not as a currency at all, it's valuable as a transaction network and as a medium of exchange between two currencies.

Say a drug distributor in the US wants to send money to a manufacturer in China. He immediately buys $x amount of bitcoins, sends them to his partner in china (or his boss, or whatever) who then immediately sells the bitcoins. When used in such a way, the price, and the volatility of the price, is totally irrelevant. Honestly bitcoin might have been better off if instead of trying to be a currency, was specifically marketed as a liquid commodity whose only value is specifically it's use for exchanging real money. It would have simplified things greatly and saved a hell of a lot of time that it will take people to realize bitcoin's only useful and effective purpose.