Bitcoins have been and continue to be controversial and confusing. Its supporters say that is the future of international currency while most people think it is a risky financial method primarily used by hackers or those who do not want their money to be traced.
Bitcoins (or cryptocurrency) is a digital form of currency that is only exchanged or used on the Internet. It is does not have a printed version like the US dollar bill. It is purely digital and not controlled by any banks, financial institutions, or countries. It is totally unregulated making it a very scary concept. It is used to pay online for services between parties who both use bitcoins.
It is the first of its kind and became famous (or should we say infamous) because of hackers. Indeed, hackers have held data ransomed in exchange for bitcoin payments. It is said that there are over 20 billion bitcoins in circulation on the web today. Every bitcoin is recorded in a public form/ledger which is supposed to prevent fraud. There are no names attached to each bitcoin so it is anonymous.
When someone owns bitcoins, they store them in a digital wallet which can be stored online via a Cloud service or offline using a hard drive or USB drive. The technical aspect of the bitcoins is quite complex with concepts like crytocurrency mining, bitcoins miners, .dat type files, blockchain, and more.
It is unclear what the future of bitcoins holds. One thing is sure, many of the big industry players are keeping a close eye on this new form of digital currency. If it stays and becomes a legitimate form of currency, regulations will be needed to secure the digital code behind each coin.