Bitcoin is the first decentralized digital currency you can send through the Internet. Started in 2009 by Satoshi Nakamoto, Bitcoins can already be used to pay for some products and services -- and even traded for analog money.
As GigaOM explains in their analysis of the Bitcoin phenomena:
That's the difficult part, of course. Why would anyone use a virtual currency that has no "real" value, and is based on a system run by a group of shadowy hackers? Some programmers have started to accept payment in Bitcoins, but that's not really a great indicator of a robust monetary platform -- in a sense, it's just like people exchanging goods or services in a barter system, something that is a big part of what economists call the "underground" or shadow economy. Supporters (including the Electronic Frontier Foundation) promote the idea that Bitcoins are free from government interference and can't be frozen or devalued by anyone.
Currently, one Bitcoin is worth about $7.30 CAD.
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