In the wake of the global economic trainwreck, people have started to lose faith in traditional banking systems. For your AM-radio listening uncle, this has meant investing in gold, which is trading near all-time highs. For experimental Web-enabled investors, this has meant placing money in the P2P virtual Bitcoin economy, which surpassed $200 for the first time on Tuesday.
This peak is particularly surprising in the wake of news that just last week, the Web's most popular bitcoin exchange, Mt. Gox was temporarily taken down by a severe DDoS attack (the company has plans to separate their front-end site the trading platform in order to avoid these types of attacks in the future). That same day, the online bitcoin "wallet" service Instawallet announced that it would be accepting claims for stolen bitcoins after its database was hacked.
Despite these pitfalls of investing in a virtual and unregulated market, the Bitcoin economy continues to thrive (or the bubble continues to expand, depending on who you ask). Just last week, the total Bitcoin economy surpassed $2 billion and has surpassed 42 national currencies in total volume.
While experimental, nation-less forms of money are nothing new, and Bitcoin has proven its aptitude for wild swings in valuation, the currency's rise from obscure top-shelf mathematical concept into mainstream phenomenon has been startling.