What is bitcoin?
I just heard of this a few days ago. Is anyone familiar with its function, purpose, use, and risks?
Bitcoins are internet money and yesterday the central website Mt Gox filed for bankruptcy after (some people say), it scammed people out of over $350 million.
Many people used them to make payments (esp international) because no one country, bank or credit card company owns them. Once you buy them, they are good on lots of websites for free (no fee).
The good thing is people can buy stuff anonymously and the bad thing is people can buy stuff anonymously. In my opinion, bitcoins are the newest way to scam people out of money on the internet because when you buy them from a central website, you and them become untraceable esp when a merchant (or a customer) wants a refund or return a product bought with them.
Now with the central website gone bankrupt, little independent sites will show up to buy and sell them to people for any price they want bec the price changes every day. If you buy a bitcoin for $75 today and the price goes up to $300 tomorrow, it changes the value of it when you want to buy something on internet. Also, once your computer gets hacked, your virtual wallet (where bitcoins are stored), goes with all your other info. And who has access to the info in your virtual wallet? The website you bought it from. That's why I say it is easy to scam people. Sell to someone, hack them, get their virtual wallet, resell or use them. Adversely, set up a website to sell them and this is called bitcoin mining - the newest and most lucrative "own your own business on the internet" scam circulating at the moment.
janshares I wasn't really sure what it was either, but I have recently been hearing the same thing that RachaelOhalloran said about the Mt Gox scam.
Google bitcoin to learn what they were used for and then Google Mt. Gox to learn about the hack that caused them to go bankrupt. My son was heavily into using Bitcoins and considered being a miner. I'm thankful he didn't invest in the hardware setup.
Yeah, as per Rachael's answer. There are quite a few digital currencies, bitcoin is just a well known one....the idea behind them was to have a currency not tied to a central economy, so that people might invest somewhere outside of their country's banks and investments and could make a profit while their country might be in recession etc. But it is still early days for digital currency and, as you can see for bitcoin, it wouldn't be necessarily a wise investment choice.
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