bitcoin/ n. A type of digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank.
Eh? No wonder so many people are confused about bitcoin. What you see above is the Oxford Online Dictionary definition of what is probably the most fashionable currency in the world. I realise that’s not saying much: currencies don’t usually have cult followings. But if the euro is the nerd no one wants to be seen with, bitcoin is the coolest kid in the class.
Perhaps part of the attraction of bitcoin for techie types is the very fact that it’s such a mystery to everyone else, accustomed as we are to traditional currencies. That makes the bitcoin club very exclusive.
So what is a ‘digital currency’ anyway? How can any kind of real money exist only in a digital form? Well, the two things that enable it to work are a) the fact that there are a finite number of bitcoins in existence, and b) the clever bit of technology that underpins it: the blockchain.
The blockchain is, in a way, the best thing about bitcoin. Safe