Bitcoin is very alive and kickin right now. The bitter truth is Bitcoin is now the de facto standard method of payment for all kinds of shady, criminal & laundering services on the net. What you got is a lawless currency, with no regulations what so ever, and no (assumed * ) oversight of trade. There so much hacking, fraud and insider scams going on, that trusting an online wallet like Bitconica is just waiting for your money to be stolen. Very hostile environment. No, this is not like "real money" at all, but it still holds value.
* it is assumed gov. institutions are monitoring large transactions now
"What you got is a lawless currency"
Laws are for people, not currency.
Property and contract laws still apply even with different currencies. The fact that the surrounding infrastructure is still being built can be frowned upon, but this has nothing to do with laws.
And yes, it is like real money. In fact it's even more like real money then what most people use daily. Bitcoin properties are almost the same as precious metals, making it much more money-like than a fiat currency. (On which we build our bank accounts and, as yet another layer, various credit tools. At the end of the day, you start to be quite far away from "real money".) Now, if such a thing is desirable is another question entirely. Nevertheless, Bitcoin is money.
Bitcoin properties are almost the same as precious metals, making it much more money-like than a fiat currency.
Actually, Bitcoin lacks one of the most key attributes of precious metals: precious metals have inherent value. Even if gold isn't useful as a medium of exchange, gold is still useful and has value because it has practical applications due to its high conductivity and corrosion resistance. Although gold's value is highly inflated due to speculation, gold still has a "minimum value" due to its utility in the area of electronics. If everyone one day decided "gold investment is stupid" and began dumping it, there would still be demand for gold due to the electronics market. Ditto for silver and platinum. These metals have value because you can do things with them. There will always be demand for these things, just as there will always be demand for iron, copper, and other non-precious metals.
Bitcoin is like currency in that it only has value because a group of people have collectively decided that it has value. Bitcoin's value is based on rarity, and the only thing that makes it different from traditional currency is that its rarity is guaranteed algorithmically, rather than by a centralized government.
You should store your wallet offline and only transfer bitcoins to an exchange at the instant you need to exchange them, and then empty the account. For purposes of this discussion, there are no "reputable" sites.
Well, you can as well use multiple wallets with different security/usage goals. For example, I use for my daily usage easywallet.org on my Android/iPhone/Computer, but for larger sums I have better storage.
* it is assumed gov. institutions are monitoring large transactions now