You are correct, it's "value" has increased as quickly as it seems. Do people have faith in bitcoins as a currency? Sure, some people do. A larger number of

You are correct, it's "value" has increased as quickly as it seems. Do people have faith in bitcoins as a currency? Sure, some people do. A larger number of people see it as a way to make a quick profit by speculating. Whether bitcoins are legitimate currency or not is irrelevant - as long as people are willing to pay "real" money for them (and there exists a way to get "real" money back out) there will be speculators manipulating the market and inflating prices. If, or how long, this will last is really anyone's guess. It could all collapse tomorrow, or (unlikely) turn into a legit "real" currency.