The Bitcoin is essentially a speculative vehicle for geeks. Basically, do not eat out and expect to pay for the meal with Bitcoins. Not long ago you could have bought illicit drugs with the currency, but the FBI closed down “Silk Road” earlier this year, which allowed people to buy illegal substances anonymously.
Introduced in 2009, the electronic currency Bitcoin is exchanged through its own payment network. The Bitcoin can be stored in a virtual wallet and has been described as a cryptocurrency; a decentralized, peer-to-peer currency that relies on cryptography to facilitate currency generation and transactions. To prevent double-spending, computers are known as “miners” to receive transaction fees and free Bitcoins in exchange for running a proof-of-work system.
You have two options: mine or trade. By mining for Bitcoins, as long as the markets remain active you can basically make money for nothing. But the problem is, mining is such a tough gig now that it is hardly worth it. Turning your computer into a miner will likely make it noisy and heat up. It would likely take you a long time to even mine a single Bitcoin, by which time you probably would have spent more on electricity.
Making a million with Bitcoins today is probably still possible, but you will need some capital. Bitcoins can fluctuate many percentage points every day. Day trading Bitcoins is going to be risky, but where is there is volatility there is the opportunity. Otherwise, you need to take a longer-term approach and conclude whether or not you think Bitcoin will be successful. If you think Bitcoin is going to be traded by foreign exchange dealers, market makers, and institutions one day, you might want to go long. Buying right now would be incredibly risky; the price chart is screaming “bubble”, but your point of entry is up to you.