HOW MUCH IS IT NOW WORTH?
One bitcoin is worth roughly $20,700, according to Coinbase, a major digital currency exchange that also trades other tokens and currencies.
But the value of bitcoin is volatile and moves hundreds or even thousands of dollars in the course of a week. A month ago, it was worth less than $17,000 and a year ago it was worth less than $7,000.
Bitcoin is a highly speculative investment and has not performed as well as more traditional forms of investing, like stocks or bonds, unless a buyer was in the currency years before it caught on. For example, three years ago The Associated Press bought $100 worth of bitcoin to keep track of the currency and to possibly build stories about how businesses were accepting it. That portfolio only broke even this month.
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WHY BITCOINS ARE POPULAR
Bitcoins are basically lines of computer code that are digitally signed each time they travel from one owner to the next. Transactions can be made anonymously, making the currency popular with libertarians as well as tech enthusiasts, speculators — and criminals.
Bitcoins have to be stored in a digital wallet, either online through an exchange like Coinbase, or offline on a hard drive using specialized software. While the bitcoin community knows how many bitcoins exist, where they all are is anyone’s guess.
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WHO’S USING BITCOIN?
Some businesses have jumped on the bitcoin bandwagon. Overstock.com accepts payments in bitcoin, for example.
The currency has become popular enough that more than 300,000 transactions typically occur in an average day, according to bitcoin wallet site blockchain.info. Still, its popularity is low compared with cash and credit cards, and most individuals and businesses won’t accept bitcoins for payments.