“I wish someone could explain just what a bit coin is in a way I can truly grasp.”
From my point of view Bitcoin is just another fiat currency. Just like the dollar since Nixon it is backed by nothing other than the willingness of people to accept it as a medium of exchange.
Technically BitCoin is a triumph of cryptography and peer-to-peer computer networking. Instead of a Federal Reserve conjuring dollars from nothingness BitCoins are created on a decentralized network of computers.
What I find fascinating about BitCoins is that as mysterious as the process behind them sounds, there is a public “ledger” and a general consensus that they aren’t created frivolously. Can the same thing be said about the present-day US dollar?
So how are they created? Is there anything of lasting, stable value assuring they have a value? I realize that our money supply is bogus and nobody's seen the gold, but the government manipulates commerce in a way that gives us confidence that I can exchange money for goods.
Heck, why don't they just use tulip bulbs to back it?