Bitcoin is an open source P2P currency that is now trading at about $237 per $1 U.S. Last week, Bitcoin was at $147 and it was at under $20 earlier in the year. Clearly Bitcoin surging in value. The spike in the price is largely due to the crisis in Cyprus, which is related to cuts to depositors’ savings planned under their bail-out.
People are losing their faith in the global banking system in Cyprus. Bitcoin is completely independent from the standard banking system. Bitcoin launched in 2009 and was designed to be a means of payment.
Earlier this month, the largest Bitcoin market known as Mt. Gox, was hit with a Distributed Denial of Service (DDoS) attack.
Bitcoins can be exchanged through a computer or smartphone locally or internationally. One bitcoin is subdivided into 100 smaller units known as satoshis. Rather than using a central bank, bitcoins relies on an Internet-based P2P network. The money supply is automated and is given to servers that confirm bitcoin transactions.