Hardware when you solve a bitcoin problem where do the bitcoin come from

[Pleng]

isnt bitcoin slowly dying?

"Slowly dying" conjures up images of the value of a bitcoin very very slowly deflating; that's the exact opposite of what's happening.

 

[FAST6191]

The finance people have been in for years, though more recently it was less a novelty and more of a serious thing.

On bubbles bursting.

What does bitcoin do that I can't just call my bank up or drop my credit/debit card down to do?

Anonymous (ish) transfer worldwide, fairly quickly (minutes rather than microseconds, though that is still far better than the days it might be otherwise and weeks if we have to use cheques) and without tax, exchange rates also less of a concern.

This is useful for
more human level transfer if you live somewhere tricky, either through scrutiny, taxes or fees.
buying drugs and things the law would rather you not buy, though mainly drugs. This for many years was considered the bedrock of the market.
Some types of money laundering.
A few smaller shops did take it as an amusing aside or a bit of free press if they were early enough ( http://www.wired.co.uk/article/london-bitcoin-pub https://www.theregister.co.uk/2013/06/25/bitcoins_now_accepted_in_hitech_hipster_hostelry/ https://www.theguardian.com/technology/shortcuts/2013/jun/23/britains-first-bitcoin-pub ). Some people say as they don't see it for that it is useless but so are my bearer bonds, cashiers cheques and such for buying bread and milk but they are still financial instruments.

A bit of volatility you can handle, indeed going as far back as the earlier black markets that used it they had means of lessening concerns here by fixing rates somewhat.
Today if you are seeing day on day increases of some significant percent if you are sensible you are not going to use it for that as it is far more lucrative to hold onto it and find some other means --
I have $1000 in bitcoin and want $100 worth of LSD. If I have a $1000 in bitcoin I probably have enough in cash for a street/more conventional buy. I wait for a 10% rise and either sell off the 10% and I got some effectively free LSD or sell off the lot and still have my $1000 (which is basically what I would have had were it in a bank) and some LSD. Equally said dealers with a stash of bitcoins are facing similar problems -- very few people deal drugs for the love of dealing drugs, and will often have side businesses on top of that selling other goods, and indeed a few years back it was noted many gangsters in the US got in on tax return fraud ( https://www.bloomberg.com/news/arti...und-fraud-fake-returns-net-gangsters-millions ), If they can make money from the bitcoins without having to get shot, busted or deal with junkies whilst showing income... well now.

There are a thousand other currencies with many of the same properties of suitably anonymous transfer. If they are more stable then there may be a shift to them if it becomes easier to handle -- in times of hyper inflation other things become currency.

Similarly there are alternatives with superior properties -- Ethereum, the thing which saw the GPU price hike earlier this year, does so called smart contracts as well as functioning as a currency. Technically you can do it with bitcoin in the same way you can do it with any common bank transfer that the law can read but ethereum had it built in from the ground up.

As far as illegality goes as long as they are not illegal in your country (a few go there but for the most part you can't restrict it should you want to claim you are a free country) then you are good. I doubt they fall under widows and orphans investments (various times you have to be financially aware to make certain investments, mainly to stop widows and orphans being ripped off) and even if there were models falling into that you can still buy some of your own.
Word of warning. While it may not be illegal many countries will have fairly complex ways of treating it for tax purposes -- it is mainly considered a financial instrument and if you don't declare profits from it that is tax evasion. If you don't declare profits properly then at best you are over paying and at worst you are evading, and in some places you might still be penalised even if you over paid and incorrectly declared it. If you made enough it might be worth buying an hour with a relevant lawyer, accountant or similar to figure it out; if you are not doing anything complex like I cover next and is a cash in, wait, cash out type affair and you don't have any other investments or income (or just a Saturday job or something) it should not take more than an hour to sort.

dAVID_ mentioned two methods of profiting from them and they are the main ones. There are other means. Some spread betting platforms support such things, though their percentages are higher than the general markets they normally cover (intertrader said 20% as of 30th of November, compared the 5-15% of so for the rest of the market -- https://www.cityindex.co.uk/help-and-support/margin-and-leverage/ ). Those do however allow other mortals the means of using other means -- many such platforms allow shorting of things and all the other fun things one can do as a market trader, albeit with a margin that makes it untenable for most. At no point during that would you be technically owning any bitcoin either as most such things are just complex betting systems. Beyond that you have the bitcoin equivalents of forex and multiple markets -- different exchanges offer different rates and they might be different enough for you to make a profit buying in dollars and cashing back out somewhere else, though be aware trying to get your money out of some exchanges is an absolute nightmare at the best of times and this is not the best of times. Some exchanges will cover multiple currencies, either real world or crypto, and differences there and in the real world may allow some profit if they are not normalised/adjusted properly you can make something*.

*it is somewhat tricky in the real world right now but in the classic days I would buy shares in London on a company. New York opens a few hours later and takes half an hour to realise what went down in London, as both exchanges cover the same company in this scenario I can sell off in New York if London is going down or buy cheap in New York if the prices are going up in London. Today this all happens in less than a second so is harder unless you are doing high frequency or some other market like a dark pool market, or have an odd company.