Let’s say you believe that the price of gold is going to go through the roof (as opposed to where it has been going lately: the basement). To capitalize on that belief, do you run out and invest in mining or smelting equipment companies? Or do you just buy gold? (You buy gold.)

But that’s just where angel investors and venture capitalists are putting cash—and stirring hype. Companies such as Coinbase, Coinsetter and BitPay, among others, are getting funding, even as the Bitcoin market itself has shown just how risky the trendy cryptocurrency of the moment can be.

“At this early stage of the game, it does seem like investing in Bitcoin (if you think Bitcoin will be the winner in these types of currencies) would be wiser then investing in a Bitcoin company,” says entrepreneur and angel investor Elad Gil. “Especially since if Bitcoin is widely used it will have lots of upside still and it is hard to choose who the winner will be in this early market.”

It is true that the amount of money being put into these companies is fairly small at this point—hundreds of thousands, rather than millions of dollars. But the venture and angel community can barely talk about anything else these days, and as their excitement ramps so will the dollars.

Imagine one of those companies gathers some steam, goes the full venture capital route and over the course of several rounds of funding raises millions. It beats back competitors, the founders stay on good terms and don’t split up, and it doesn’t succumb to hacker attacks on its Bitcoin horde. In other words it succeeds.

“But if you're investing in a company in the Bitcoin economy, you have to compare the valuation of the company to the valuation of the entire economy,” says Naval Ravikant, AngelList CEO.

If that Bitcoin company has a valuation of $25 million and the entire Bitcoin economy has a valuation of $1 billion (about where it is today) the deal starts to look pretty weak.

“You're betting that this company will capture 2.5 percent or more of the economy in profits over its lifetime,” Ravikant. “That's a tough bet, because Bitcoin can succeed and any given company can fail, but vice versa is almost certainly not true.” In other words, if Bitcoin doesn’t succeed and become the cryptocurrency of choice, your Bitcoin economy company can’t either.

Y Combinator Partner Garry Tan is making the bet that Bitcoin succeeds with his investment in digital wallet startup Coinbase. He agrees that having some Bitcoin squirreled away is wise (and you can bet the craftiest VCs are leveraging up their own Bitcoin caches by investing in companies that takes a whack at improving the Bitcoin ecosystem).

“I have done some of that,” Tan says laughing. “But the buy and hold thing, that is not interesting to me.” What is interesting to Tan is backing companies like Coinbase that he believes can help Bitcoin make the transition from speculative “toy” that people horde like gold rather than spending, to something that people can actually use.

Tan’s vision for Bitcoin is as a universal currency that will make money transfers easy and cheap from any person or business to any other person or business across the globe. In that scenario Coinbase becomes a far-cheaper version of Visa. “Bitcoin has the potential to destroy credit cards and banks as we know it, maybe that is a good thing or a bad thing,” Tan says. “But I like the idea that if someone needs to remit payments they can do it without being gouged.”

If Bitcoin starts to become a widely used digital currency, something that people actually spend on products and services, Tan’s vision, and that of every Bitcoin economy startup and their investors, begins to make sense. So do the competing cryptocurrencies beginning to crop up like Ripple that are designed to promote use rather than speculation.

As Gil observes, at this juncture it’s unclear whether Bitcoin is the winner or just the early front-runner among mathematical currencies. What you are likely to see over time is investors and speculators both hedging against the overall market by placing bets on multiple math-based currencies. Opencoin, the company behind Ripple—and backed by Andreessen Horowitz and Lightspeed Venture Partners—is one current example.

What the excitement among angels and VCs in these Bitcoin and cryptocurrency economy companies really shows more than anything is a growing belief that some math-based currency will take hold and sooner rather than later. But until we know which one, investors in Bitcoin companies risk finding themselves with what amounts to a warehouse full of Betamax players just when the world is about to switch to VHS.