Is Bitcoin the new gold?
Some former gold bugs certainly think so.
And its value has skyrocketed in recent months.
But many readers at this point are probably wondering ... what exactly is Bitcoin?
Robert McNally, an iOS developer at parking payment startup QuickPay, gave the following presentation to last year's Hackers' Conference in Santa Cruz, answering exactly that question.
With his kind permission, we have republished it here.
Let's begin ...
And start with basics.
In 2013, Bitcoin *is* money — at least for some — and that population grows each day.
In this community, it has developed the same properties as regular cash.
Though some prefer to think of it as more akin to gold, due to its durability and limited supply.
But technically, it is a cryptocurrency.
That means there are no records or files on the transactees.
This is Bitcoin's principal benefit for many currency hawks or central bank doubters.
There have been previous attempts at cryptocurrencies, but Bitcoin is unique.
In theory, no one controls it. And you can also take it anywhere, since it's just code.
Here's how Bitcoins are made ...
Computers "mine" for it by cracking a predetermined encrypted program. This is a quite difficult task, which is what gives Bitcoin its inherent value.
As Boromir would say ...
Does this look familiar? Plotted over millennia, it represents the arc of known gold stocks. Plotted over decades, it's also, in theory, true for Bitcoin.
Here's what "miners" look like in real life.
One "block" of Bitcoins is created about every 10 minutes these days. We'll see how much one block is in a moment.
Again, mining for Bitcoins requires a heck of a lot of dedicated computer memory.
Do Bitcoins look like anything?
As previously stated, they're basically just code.
So how much is a "block"? It's been changing every day. This chart is now very outdated — Bitcoins traded as high as $94 last week.
So who's actually accepting Bitcoins? When they first came on the scene, pretty much only programmers or gamers were.
But as its popularity — and value — grows ...
So does the range of things you can buy with it.
And now, chances are your card shark buddy would allow you to pay off your debt in it.
More on currency mining ...
Check out Business Insider's picks for best cryptocurrency exchanges
