I'll admit it, I've never used Bitcoin. I'm no Ross William Ulbricht, allegedly "Dread Pirate Roberts," proprietor of underground Bitcoin-based Silk Road criminal marketplace , with a need for anonymity. I'm not interested in gambling that the value will go up. I'm looking for a convenient way to buy things.

Bitcoin doesn't do it for me, and Benjamin Edelman, Associate Professor at Harvard Business School, has a good explanation of why my instincts are correct. They just don't compete with credit cards.

The key is that the price of the product that you're buying is generally the same no matter what you pay with (gasoline, in some places, is one of the rare exceptions). If I'm buying $100 of widgets from Acme, I can give them $100 cash, in which case I'm out $100 and Acme has that much. If I pay with a credit card, I'll get a bill for $100 later, Acme will get $100 less the discount (the fee paid to the bank), so probably about $98. If I buy with Bitcoin I have to go to my wallet, like Coinbase, and pay $101 to get $100 of Bitcoins, the extra $1 going to Coinbase, and pay the Bitcoins to Acme. Hopefully, the price of Bitcoin hasn't swung in the meantime to the point that $100 isn't enough anymore.

So with Bitcoin I'm paying the transaction fee, not the merchant. But it's worse than that. Credit card companies compete wildly based on customer benefits, from purchase protection to hotel and airline points. Yes, there may be a fixed annual fee and you'll pay high interest if you don't pay off your bill every month, but you can make out much better with a credit card than with Bitcoin if you do pay your bills. And if you use the credit card enough, the value of the benefits drowns out the fixed annual fee.

For me the transparency aspect also argues against Bitcoin. This stuff is confusing, and adding in the complexity of the exchange rate doesn't help matters.

I'll grant that the Bitcoin ecosystem is pretty young and that they may get better, but I think only at the expense of whatever might be a benefit to Bitcoin. Banks want your money because, while they have it, they can make money on it. What about a Bitcoin wallet company? Are they banks? Can they loan out the coins in your wallet? Without some sort of scheme like this they can't afford to offer discounts or benefits like the credit cards offer.

It might get better once the system gets as organized as it is with cash and credit cards, but then what's the benefit of Bitcoin? If you're going through a bank it's not like you're anonymous. Institutions like that are heavily regulated and obligated to keep an eye on what you're doing with your money.

Edelman asks where Bitcoin could really bring value and comes up short for an answer. International payments? Western Union will send $1,000 to dozens of countries for $8, far less than you and the receiving party will pay for a Bitcoin transaction.

The gee-whiz coolness of the Bitcoin algorithm may end up being valuable somehow, but as a currency, the value proposition to the average person just isn't there.