Bitcoin explained

Bitcoin and other crypto-currencies are all the rage, but what exactly are they, and how do they work?

Posted: Jan 19, 2018 10:31 AM

(NBC News) Bitcoin is a financial buzzword, but what is it? And should you invest?

Cryptocurrencies like Bitcoin can be confusing.

Bitcoin doesn't involve physical coin at all. It's virtual, global currency with no bank or government backing it up, worth what others are willing to pay for it.

"It has value because we believe its worth what it is just like the dollar its just a piece of paper," explains Bitcoin enthusiast Jacob Parrish.

When Parrish started a bitcoin meetup group with Mark Dukas in 2013, some meetings would just be the two of them. Now it's standing room only.

Interest and value are growing. More businesses are accepting digital currency as payment, and apps, Bitcoin ATMs and online exchanges are making it easier for people to buy in.

Chris Yountz started investing a few months ago, but isn't expecting to get rich quick.

"Only invest as much as you're willing to lose, because it's very volatile," he advises. "One day you could make a couple thousand dollars, one day you could easily lose that."

The price fluctuates based on the bidding on exchanges, similar to stocks and gold prices.

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