NBC News - Bitcoin: The Internet's secret currency makes its first public appearancesSubmitted by SteveMT on Sat, 04/06/2013 - 14:17
Bitcoin is going mainstream.
Bitcoin: The Internet's secret currency makes its first public appearances
Devin Coldewey Published 4-5-13
Financial brinksmanship in the Eastern Mediterranean seems an unlikely way for an obscure yet infamous virtual currency to become a household word, but that's what happened with the bitcoin. Over the last few weeks, bank turmoil in Cyprus and a frenzy of attention from the media have propelled the "crypto-currency" from the darkest corners of the Internet to the front page. But is this phenomenon a blip or a revolutionary new financial instrument?
Existing only as numbers on the Internet, bitcoins are not tied to any retailer or company or bank. They have no real-world value other than what people agree to. And yet, at the time of this writing, each of the 11 million or so bitcoins in the world could be exchanged for just over $130 in real money — for a total value for the "currency" topping a billion dollars.
One way to look at it is like vintage baseball cards or comic books. There's a finite number of them out there, so as interest in owning them rises, the amount someone would pay for them goes up. And because there's a perceived value (an exchange rate), if someone is in the right market, that card or comic — or bitcoin — can be used to "buy" goods.