Behind The Mic With Joe Mathieu: What Is Bitcoin?
BOSTON (CBS) - It's one of those things you hear about but you're not too sure exactly what it is, even though it seems pretty important.
And now that the first Bitcoin ATM has arrived in Boston (at South Station), it's time to get with it.
Yes, Bitcoin is currency. But unlike the dollar, it's it is not backed by any government or country. And it exists online.
Bitcoin is also traded, but unlike traditional currency, it's bought and sold between individuals, rather than banks. And that trading is essentially what sets its value, which by the way has been quite volatile lately.
While a virtual currency may sound "pie in the sky," you should know that Bitcoin has seen remarkable growth and some major companies are already accepting it.
In fact, the Sacramento Kings last year became the first pro sports team to do so. You can even use Bitcoin to book trips through Cheapflights.com.
So what's the downside, you ask?
You could argue that it's too early to say. Bitcoin is really still in its infant stages. But some investors are learning they can get burned.
One of the biggest online exchanges used to trade Bitcoin called Mt.Gox has seen a virtual run on the bank thanks to a technical glitch.
That's creating big losses for some and opportunities for others.
Because, just like in the stock market, someone is always making money - whether it's going up or down.
Follow Joe on Twitter @joemathieuwbz
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