JUNE 2, 2011, 9:32 P.M. ET
The Currency That's Up 200,000%
Bitcoins are the top-performing money in the world -- but what are they?
By JACK HOUGH
SmartMoney.com
The best performing currency of the past year isn't Brazil's real, up 15% versus the U.S. dollar, or Australia's dollar, up 27%. It's the Bitcoin. A year ago one was worth half a penny. Thursday morning it hit $10.50. That's a gain of more than 200,000%.
What's a Bitcoin? It's a peer-to-peer system of electronic money that allows payments to be sent directly between two parties without the need for a financial institution. It's related to Bit Torrent, a system for sharing large files like movies, but in this case the "movie" is a file with the currency's entire transaction history. And because users themselves all share that history, "it's more secure than even bank transactions," says Donald Norman, a spokesman for the Bitcoin Consultancy, which is seeking to gain wider acceptance for the currency.
More: http://www.smartmoney.com/invest/stocks/the-currency-thats-up-200000-1307029053200/
| 