How do Bitcoins work?

[Amos Moses]

OK, being an old fart, I don't get it. Read the below link. This kid obviously knows how it works!

http://finance.yahoo.com/news/colleg...153845085.html

[sportdawg]

http://en.wikipedia.org/wiki/Bitcoin

I'm still not 100% sure & I've been following it since a drug dealer/prostitution website got shut down and made headlines for Bitcoin.

[RunwayDawg55]

I've heard (no confirmation) that this COULD have been some sort of clever viral-advertising for the bitcoin business, which makes sense... The guy holding the sign could be part of the bitcoin company, bitcoin then deposits tens of thousands of dollars into this "account", the story goes viral and people like you and me who have never heard of bitcoin are now googling it and checking it out to see what the deal is. Or that could be all wrong and the generosity of random internet people just gave some college kid $20k+ to go party it up.

[Tech77]

I've heard (no confirmation) that this COULD have been some sort of clever viral-advertising for the bitcoin business, which makes sense... The guy holding the sign could be part of the bitcoin company, bitcoin then deposits tens of thousands of dollars into this "account", the story goes viral and people like you and me who have never heard of bitcoin are now googling it and checking it out to see what the deal is. Or that could be all wrong and the generosity of random internet people just gave some college kid $20k+ to go party it up.

Scenario No. 1 seems more likely.

[StrayDawg]

Amos,

Bitcoins are strings of code generated by computers, which can not be duplicated, and you can make them on your own computer (but they take a lot of resources). Because they are unique and verifiable, some people trust them as currency, but they can also be lost if you have a data loss, such as a hard drive crash. One guy had several thousand dollars worth of bitcoins stored in his Amazon cloud account, and when Amazon rebooted one of their servers, his coins were lost forever, because you can't make copies.

There is no bitcoin company, so there is no product or service, and the "value" is based strictly on fear and greed, much like gold and silver. A few months ago, the value was about $2, now I think it is close to $300. This is the latest craze among computer nerd-types. The fact that it is such a craze is pushing the value higher, but it is probably bound for a bust at some point.

I have never used Bitcoin (or tried to generate any), but I work with a guy who is fascinated by it. From what I hear, the feds hate Bitcoin because they can't trace it's everyday use, and they want their hands on everything. Hope that helps.

[kw2292]

I think it's great to challenge the Fed reserves monopoly on currency. Don't know much about it other than the original "miners" made a lot of money, and developed sophisticated machines for extracting them.

[hoppinmad]

http://www.elitetrader.com/vb/forumd...php?forumid=67

[hookdown]

Apparently, they work very well....



http://money.cnn.com/2013/12/06/auto...html?hpt=hp_t3

[hookdown]

I had never heard of it until this thread, but it appears to be growing.


http://finance.fortune.cnn.com/2013/...source=cnn_bin

[TYLERTECHSAS]

http://dealbook.nytimes.com/2013/12/...coin-mines/?hp