Some individuals consume time at the airport by browsing duty-free stores.

I chose to look for bitcoin. However first, there are 2 things you should understand about me: I tend to be nearly as scared of losing cash investing as I am of flying. On some level, I figured one worry might counteract the other.

So last Thursday, while waiting for a flight to Nashville, I pulled up a popular application called Coinbase that can be utilized to purchase and sell bitcoin. The virtual currency had hit $10,000 for the very first time a couple days earlier, before retreating somewhat. News of bitcoin’s fast rise was everywhere, including on CNN.

Related: What is bitcoin?

For 15 minutes at the airport, I revitalized the rate of bitcoin over and over, watching as it got and lost hundreds of dollars in a matter of minutes. I called out the rate changes breathlessly to my wife, who carefully motivated me not to be an idiot, prior to returning to her publication.

She remained in excellent company. JPMorgan Chase CEO Jamie Dimon recently called bitcoin a “fraud” and suggested people who purchase it are “foolish.” Warren Buffett called bitcoin a “mirage” in 2014 and alerted investors to “stay away.”

Are you trading Bitcoin? We wish to hear from you.

And yet bitcoin has climbed up more than significantly given that Buffett’s warning. Previously this month, one college friend delicately informed me over beverages he ‘d made 10s of thousands of dollars buying another cryptocurrency. He stated he hoped it would deserve enough one day to purchase a house.

When I saw the rate of bitcoin fall to $9,500, I pushed buy, defying the wisdom of two finance titans and my spouse. One hundred dollars, or 0.0101 bitcoins. (A couple of days later on, I purchased another $150.) By the time we got to our hotel, my stake had currently gone up 10%. One week later, it was (briefly) up 100%. My spouse’s opinion of me has actually reportedly reduced by the very same amount.

What is taking place?

It’s an investing craze, plain and simple.

Bitcoin split $1,000 on the first day of 2017. By today, it depended on $12,000, and after that it really removed: The rate topped $17,000 on some exchanges Thursday, and $18,000 on a minimum of one.Other cryptocurrencies have actually seen comparable spikes, though they trade for much less than bitcoin.

There’s a long list of elements individuals may indicate in an attempt to describe this. Regulators have taken a hands-off technique to bitcoin in particular markets. Dozens of new hedge funds have actually released this year to trade cryptocurrencies like bitcoin. The Nasdaq and Chicago Mercantile Exchange plan to let financiers trade bitcoin futures, which may attract more professional financiers.

Related: Bitcoin plunges more than $2,500 after striking new record

Yet a key factor the price of bitcoin keeps going up is, well, due to the fact that it keeps increasing. Small investors like yours really have a worry of missing out on a chance to get abundant quick. And when the worth of your bitcoin doubles in a week, as it provided for me, it’s easy to think you’re a genius. However you can get burned presuming it will keep increasing.

Some financiers have compared the bitcoin buzz to the dot-com bubble. Others, like Dimon, have stated it’s even” worse “than the Dutch tulip mania from the 1600s, considered among the most popular bubbles ever.

As Buffettput it back in 2014, “the concept that [bitcoin] has some huge intrinsic worth is just a joke in my view.” Bitcoin is not backed by a business’s revenues, or the strength of a government and rule of law. There’s likewise no interest or dividends.

Why would anybody want or need to use bitcoin?

Bitcoin serves as a new sort of currency for the digital period. It works across international borders and doesn’t require to be backed by banks or governments.

Or a minimum of that was the guarantee when it was developed in 2009. The rise and volatility of bitcoin this year might be excellent for those who invested early, however it weakens bitcoin’s practicality as a currency.

Related: Bitcoin boom may be a catastrophe for the environment

Right now, I can use my bitcoin holdings to spend for purchases at Overstock (OSTBP), or book a hotel on Expedia (EXPE). But if I utilize bitcoin to buy $25 worth of socks on Overstock today, and the cost of bitcoin quadruples next week, I’ll seem like those socks in fact cost me $100. However, if bitcoin crashes, at least I’ll always have the socks.

Rather than a currency, bitcoin is being dealt with more like a property, with the hope of reaping fantastic returns in the future.

So exists anything genuinely valuable about bitcoin?

Yes, the innovation behind it.

Bitcoin is built on the blockchain, a public ledger consisting of all the transaction information from anyone who uses bitcoin. Transactions are added to “blocks” or the links of code that comprise the chain, and each transaction must be taped on a block.

Even bitcoin critics like Dimon have actually said they support using blockchain technology for tracking payments.

Exists a legal and legitimate way to invest in bitcoin?

Bitcoin exchanges have a checkered history. Mt.Gox, once the largest exchange, shut down in 2014 after losing hundreds of countless dollars worth of bitcoin after a hack.

Today, the leading exchange is provided by Coinbase, a startup that has actually raised more than $200 million from a variety of leading tier equity capital firms. Square (SQ), the payments service, is also presenting a bitcoin product.

There are likewise bitcoin ATMs in spread bodegas and corner store around the nation, through companies like Coinsource. The ATMs let you exchange bitcoin for cash, or vice versa by scanning a QR code from the digital wallet application on your phone.

Related: Countless dollars taken in bitcoin hack

With Coinbase, you should first provide the app permission to connect to your checking account. As with other stock trading applications, you pay a little cost for each transaction, buying and selling. But the deal can take substantially longer.

My original $100 bitcoin purchase won’t formally be finished on Coinbase till Friday, more than a week after the transaction. The cost I bought it at remains the very same, but I will not have the ability to sell at the earliest up until Friday.

If the rate drops before then, I’m out of luck. No socks for me.

— CNN’s Selena Larson added to this report.

CNNMoney (New York City) First published December 7, 2017: 3:02 PM ET