What you should know about Cryptocurrency advocates is they're likely trying to SELL you on the need to buy into their scheme because they want to pass off their cyberbeaniebaby for more than it cost to produce it. Most of the cryptocurrencys started as an intentionally malicious form of a ponzi scheme (best to call it a Satoshi scheme).
Most of the supply is produced early on so you need to psychologically exploit new users into thinking the supply is rare (only the production of new coins becomes less frequent). Because the cryptocoin exchanges are unregulated, traders easily use tactics like wash trading and painting the tape to push the spot price up higher and higher. The game is ultimately to sell for a high fiat price to the uninformed bagholders who are late to the party and don't understand the system.
Perhaps there may be a form of ecash in the future that doesn't use an exploitative economic model of supply production, but for now be warned. (assuming a less manipulative supply production curve is implemented, PoW style mining still only transfers capital in proportion as computational work into the new system)
See also the false equivalency to gold:
If you understand the computer science behind Bitcoin, you'll realize how ridiculous the false equivalency to gold is.
1. The claim of "rare" doesn't exactly hold true.
Consider the 10,000 BTC pizza - how did this happen? This was the direct result of Satoshi's economic policy, granting vast sums of BTC to mint out very quickly very early for a short duration to the very small pool of people who ran the software. Satoshi's algorithm produced BTC in plentiful quantities enabling the 10,000BTC pizza - thus it wasn't rare if you were Satoshi and the dozen other early whales hording as much as possible, until the algorithm begins cutting off the production and limiting later users from producing coins, starving the economy. Now there's a psychological game being played, where public relations and marketing must convince new users to buy in. Because the exchanges are unregulated, they can manipulate the spot price though wash trading and painting the tape [2] (where trades are falsified and you just sell the same item back and forth to your friend for a higher and higher price).
The supply was created by running a piece of software. It's not magic. Most of the supply was produced very early on and as much as 30% of all Bitcoins are owned by less than 100 people.
Best estimates are that there are about one million
holders of Bitcoin; 47 individuals hold about 30 percent,
another 900 hold a further 20 percent, the next 10,000
about 25% and another million about 20%, with 5% being
lost. So 1/10th of one percent represent about half the
holdings of Bitcoin and 1 percent close to 80 percent
(http://www.businessinsider.com/927-people-own-half-
of-the-bitcoins-2013-12). The concentration of Litecoin
ownership is similar
(http://litecoin-rich-list.blogspot.com).
Most of the big wallets have been in place from early on,
so sitting back and watching your capital grow has been a
very successful strategy.
The distribution of Bitcoin holdings looks much like the
distribution of wealth in North Korea and makes the
China’s and even the US’ wealth distribution look like
that of a workers’ paradise
2. Easy migration to more advanced e-cash services, LTC, XMR, ETH, so on See:
https://coinmarketcap.com/currencies/views/all/3. Bitcoin network requires ASIC miners, largely centralized in China [3]. Assuming the inveitable surpassing of a more advanced cryptosytem making Bitcoin obsolete, as the market is informed there will be a decline in BTC's spot price and once this falls below the cost of OPEX for miners, the hardware goes offline and the network will cease to function. Maximalists will attempt to offer an emergency fork, in any attempt to save their "investment", just as they have developed the lightening network to create centeralized payment hubs, so "investors" can act as liquidity providors and take fees, instead of miners.
4. Electricty usage is unsustainable, GOTO 3
[1] https://bitcoin.stackexchange.com/questions/86/is-it-possibl...
http://www.businessinsider.com/bitcoin-inequality-2014-1
[2] https://www.youtube.com/watch?v=6r04gfWfRkE
[3] https://qz.com/1055126/photos-china-has-one-of-worlds-larges...