The bitcoin market seems to not be very stable. The value if the currency fluctuates everytime there is a fork. If I invested say 1000$ USD and the market crashed, would I be able get my $1000 back?
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1This question is far too broad. Try making it specific– spuderCommented Aug 10, 2013 at 3:27
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1@spuder I disagree. It's very specific. However, nobody here can give a definitive answer, since the question is essentially, "Will I lose money if I invest in Bitcoin?" Since none of use have future knowledge, we can only answer this in opinions.– Nick ODellCommented Aug 11, 2013 at 3:07
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No, if the market crashed, you would not get your 1000$ back. That is the nature of a crash, unless there is a recovery afterwards. You can see the historical exchange rate of bitcoins, to get an indication of the stability.
The way I see bitcoins is as a tool for money transfer. The advantage of having bitcoins is that you can then transfer money very fast and cheaply. The price of bitcoins will be determined by how much money people want to have as bitcoins, and that will be affected by a multitude of factors, including stability of the exchange.
Generally, I would say that when people need to determine the value of new assets, they are very unsure and that will result in a lot of volatility. An example of this was the value of Facebook stocks, which crashed soon after the stock was made available for public trading. After a while, though, I believe that most valuations will stabilize unless the fundamentals behind the asset change. Of course, bobbles, like we have seen with Bitcoins might counteract the stabilizing over time.
