If you're too embarrassed to admit that you don't really understand the digital currency Bitcoin, you're not alone.
Google says one of the top searches of 2013 in the U.S. is "what is Bitcoin?"
So, what is it?
Well, as I said, it is an entirely digital currency. It does not exist in physical form.
And you can make transactions with Bitcoins without any middlemen, which means no banks, no fees.
And you never have to give your real name, making Bitcoin the currency of choice for those who want to conduct anonymous purchases on the Internet.
But you might be wondering one thing, if it doesn't exist in the physical world, how can a Bitcoin have any value?
After all, we've seen how easy it is to copy other digital goods like movies and music,
so why can't Bitcoins be copied?
Well, that's because each Bitcoin is a product of an incredibly complicated math problem.
It's a problem that can only be solved by very powerful computers.
And even then, it takes some time to come up with a solution.
Now, having a set of powerful computers running around the clock to solve that problem is called a Bitcoin mine.
And Pauline Chiou visited one right here in Hong Kong.
If you want to see how Bitcoins are created, come inside this industrial building in Hong Kong.
These are the copper pipes.
Kar-Wing Lau runs a data storage company that houses a Bitcoin mine.
What is a Bitcoin mine?
It's computer hardware stored inside these metal racks
that work around the clock cracking an algorithm that spits out digital Bitcoins when the equation is solved.
Of course, it's a virtual currency. There's no physical coin,
but its value recently topped $1,000 after policymakers in the U.S. indicated they were open to the idea of a digital currency.
Senator Carper, I think there is broad-based agreement about the potential of a digital economy and virtual currencies.
Like a gold rush, more Bitcoin miners are setting up shop.
More and more private people, as well as some more professional organizations stepped into the Bitcoin market and started mining.
And this increased hashing power, as we call it.
The algorithm automatically adjusts the difficulty upwards.
The Bitcoin network automatically changes the difficulty of the math problems depending on how fast they're being solved.
The algorithm has capped the number of Bitcoins at 21 million.
This kind of raw computing power requires new hardware, electricity and storage space.
The Bitcoin mine that is located here uses a special immersion liquid to keep its electronics at a stable temperature.
All of this costs the mine more than $65,000 a month to operate.
The Bitcoin mine in this data storage center was designed and set up in just six months.
And it was funded exclusively in Bitcoins.
Lau's storage company was paid in Bitcoins, which he converted into euros, Hong Kong dollars and renminbi, to buy parts for the storage system.
These are pictures of the data center in Montreal that we're using.
David Shin is a Hong Kong banker who has joined four other partners to start a Bitcoin mine called IceDrill.
They will set up the mine in Montreal close to the computer hardware manufacturer.
Just like mining, you need a pickax or you need sort of, you know, equipment to be able to mine.
And transactions in China with the largest Bitcoin exchange in the world can still move the Bitcoin market.
So the global part of the Bitcoin community, I feel, they're much more on the libertarian side.
They are looking to grow the ecosystem. They're reinvesting their Bitcoins.
China, I feel that from what I can tell, they are buying to hold them.
Shin believes the idea of a digital currency can take off. It might just take a while.