Listen Money Matters - Free your inner financial badass. All the stuff you should know about personal finance. What the F**k is Bitcoin?
How does a currency just materialize, seemingly from thin air? Are they only for people who like buying drugs on the internet? What is a Bitcoin? Want to know how to invest in Bitcoin? We'll break down the mystery for you.
If you find the concept of cryptocurrency confusing and, well, cryptic - you are certainly not alone. In the last few months, people have been foaming at the mouth over Bitcoin raising its value to never seen before prices. I'm sure every day you hear someone talking about it, but many of us still don't really understand what it is exactly.
Bitcoin is the first decentralized digital cryptocurrency. It's like a digital token that is made of a hash- a random string of numbers and characters. It has no physical backing and can be sent electronically from one user to another, anywhere in the world. Because there are a finite number of the coins, there is scarcity so the value constantly fluctuates.
Bitcoin is not run by a single company or person- it's run by a decentralized network of computers around the world (owned by regular people) that verify all transactions. Similar to how Wikipedia is maintained by a decentralized network of writers.
Show Notes
Domino's Pizza Accepts Bitcoins
Turns out that there are legitimate businesses that are starting to accept this form of digital currency. There are not many, but this is a big one.
Bitcoin Exchange CEO Charged with Laundering $1 Million Through Silk Road Andrew pointed out that there's been some controversy around Bitcoin and the drug market. This is the article he was referring to.
This is how you create Bitcoins (seemingly out of thin air) — you "mine" for them.
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