Self-signed certificates are insecure. Yes, really. "At least it's encrypted" isn't helping at all. From the article:
World-class encryption * zero authentication = zero security
If your website is for you and a few of your friends, then you might create your own CA and distribute your certificate to friends.
Otherwise either get a certificate from known CA (for free) or don't bother with self-signed certificates at all, because all you'd get is a false sense of security.
Why just encrypted traffic is not secure? You're always allowing the other end to decrypt your traffic (you have to, otherwise you'd be sending gibberish).
If you don't check who's on the other end, you're allowing anybody to decrypt your traffic. It doesn't make a difference if you send data to an attacker securely or not securely — the attacker gets the data anyway.
I'm not talking about checking whether e.g. paypal.com belongs to a trustworthy financial institution (that's a bigger problem). I'm talking about checking whether you're sending data to the paypal.com, or just to a van around the corner that sends a certificate saying "yeah, I'm like totally paypal.com and you have my word that it's true!"
