IMHO, bitcoin appeals for various reasons that compare favorably with national currencies such as the USD. Those reasons being: anonymity, ease of use, and freedom to send my money any where in the world.
err... I think I disagree on those first two points.
Managing a wallet in a manner that won't result in it getting stolen (as in, disconnected from your main machine) is not easy. Though I suppose tools can be created to make this easier, they don't exist yet.
Also, bitcoin is very traceable. Publicly traceable even. You know which group is getting what, when, and once you ask those recipients for who, you know who's being getting what, when, where, and maybe a bit about how much they have.
Apparently this can be improved? I have no idea how without trusting someone.
I think there are ways to obfuscate who owns what, e.g. always use new addresses and send your coins around a few times to other addresses to hide the true origin. As far as I understand it, it's very hard to track that kind of obfuscation (though certainly not impossible, sure).
As for managing your wallet, you could use a service like coinbase.com. They keep their coins offline. And you could browse to their site through Tor.
> As far as I understand it, it's very hard to track that kind of obfuscation
You understand it incorrectly, then. Bitcoin is not anonymous and transaction flows through the network are very easy to trace. Additionally, it is very easy to link specific transactions to regions or even specific network addresses/services.
Yes, it's not inherently anonymous. But it is possible to obscure the owner of the coins. It's not foolproof, but it probably makes it a little harder to figure out who is doing what...
