What is Bitcoin?

George from Santa Monica, CA

Episode 1423 (19:30)


George keeps hearing about BitCoin and how much the price keeps going up. What gives it that value? Leo says nothing but sheer belief. BitCoin is crypto currency, which are essentially digital dollars that don't exist outside of a computer. You can't really take it and spend it at the local store unless the store takes it. But even a dollar bill isn't really anything but a fiat currency that the government says it's worth. The value of a dollar, or any other currency, changes all the time. It's fluid. So BitCoin is just an extreme version of that. They are stored in a Bitcoin wallet or service, and can even be traded in for real dollars. Hackers tend to like bitcoin because it can be somewhat anonymous.

Is it real? Not really. But no currency really is.