How to Answer "What are Bitcoins?"

[hazek]

"A digital commodity that behaves like cash" is what I would say to a layperson.

[Epoch]

"A digital commodity that behaves like cash" is what I would say to a layperson.

We may have a winner, folks.

[gnar1ta$]

"A digital commodity that behaves like cash" is what I would say to a layperson.

It's not always digital...how about a financial commodity?

[Phinnaeus Gage]

"A digital commodity that behaves like cash" is what I would say to a layperson.

It's not always digital...how about a financial commodity?

"Bitcoin is a financial commodity that behaves like cash."

How close are we?

[Serge]

"Bitcoin is a financial commodity that behaves like cash" sounds more confusing

my vote goes for
"A digital commodity that behaves like cash"
- it is purely digital even if it can take tangible appearance

[gnar1ta$]

- it is purely digital even if it can take tangible appearance

So is my paycheck, which rarely takes a tangible appearance.  I think I have more physical bitcoins that physical dollars at any given time. I don't even know where my checkbook is, that's probably bad.

[RodeoX]

Bitcoin is a type of electronic carrot used on the internet to buy drugs and socks for alpacas. 

[Serge]

- it is purely digital even if it can take tangible appearance

So is my paycheck, which rarely takes a tangible appearance.  I think I have more physical bitcoins that physical dollars at any given time. I don't even know where my checkbook is, that's probably bad.

when you will able to hash transactions off digital realm we could call it something else beside being purely digital )

[gnar1ta$]

when you will able to hash transactions off digital realm we could call it something else beside being purely digital )

The hashing isn't the bitcoin, it's used to produce an address and record and secure transactions.  Banks preform similiar functions, in the digital realm.  Whatever works best for you is great.  I'm just pointing out that bitcoin isn't that far from how many people treat money today (other than where you can spend it).  I really can't remember the last time I bought something for cash, or even carried cash.  I have direct deposit, online bill pay, and debit cards.  I transfer money to friends with Dwolla and Paypal.  My main bank doesn't even have physical buildings. The only thing different about using bitcoin is the transaction procedures are reversed (protecting my account information), and it's all decentralized (preventing tracking and freezes).  People understand that.  Why confuse the issue - unless they ask for more detail. 

[Phinnaeus Gage]

Bitcoin is a type of electronic carrot used on the internet to buy drugs and socks for alpacas. 

You almost had it right!

Bitcoin is a type of electronic carrot used on the internet to buy socks and drugs for alpacas. 

[DeathAndTaxes]

Bitcoin is a type of electronic carrot used on the internet to buy drugs and socks for alpacas. 

You almost had it right!

Bitcoin is a type of electronic carrot used on the internet to buy socks and drugs for alpacas. 

You must have been doing some of those drugs because Satoshi told me


Bitcoin is a type of electronic carrot used on the internet to buy alpacas and drugs for socks. 

[Phinnaeus Gage]

Bitcoin is a type of electronic carrot used on the internet to buy drugs and socks for alpacas. 

You almost had it right!

Bitcoin is a type of electronic carrot used on the internet to buy socks and drugs for alpacas. 

You must have been doing some of those drugs because Satoshi told me

Bitcoin is a type of electronic carrot used on the internet to buy alpacas and drugs for socks. 

Bitcoin is a financial commodity that behaves like cash but, unlike cash, it can buy drugs for alpacas hooked on socks. 

[bb113]

I don't know if there is non-nerdy language available to explain it. Usually it goes something like this:

Its a peer-to-peer currency that works like torrents. You can use it like paypal or a credit card, but there's much lower fees since paypal and credit card companies are ripping us all off. The idea for this has been around since the 80s but the trick was to make every transaction verified by the network of people using it so there's no counterfeiting. Its only been around two years so right now alot of people use it for political reasons or to buy drugs over the internet and stuff. The price is really volatile right now so you can make a bunch of money gambling on it. If the project works out one bitcoin could be worth a grand or more in a few years, its like 6 bucks each right now. I bought an e-cig with it and quit smoking...

Then go into the conversation about quitting smoking and why you just bummed a cig off the person.

[DeathAndTaxes]

Bitcoin is a type of electronic carrot used on the internet to buy drugs and socks for alpacas. 

You almost had it right!

Bitcoin is a type of electronic carrot used on the internet to buy socks and drugs for alpacas. 

You must have been doing some of those drugs because Satoshi told me

Bitcoin is a type of electronic carrot used on the internet to buy alpacas and drugs for socks. 

Bitcoin is a financial commodity that behaves like cash but, unlike cash, it can buy drugs for alpacas hooked on socks. 

You win.

For some reason I lolz at the idea of alpacas who are hooked on socks.  Now my co-workers are looking at me.

[casascius]

If the person understands BitTorrent:

"You know what BitTorrent is, right?  Well Bitcoin is the same thing, but for money.  You can buy illegal drugs with Bitcoins.  The website for illegal drugs went up last February and no one has been able to shut it down since.  Not that I advocate people using drugs, but I say that just to give you an idea of how serious of an idea this is.  Also, Bitcoins fluctuate in value.  Within the last year, they have been 47 cents, they have been 30 dollars.  Today they are just under 7 dollars.  Here is a bitcoin.  Go google it.  If nothing else, stick this under your mattress, don't forget you have it, because if you hear about Bitcoin in the news and not from me, it could easily be worth $100.  Or it could be worth $0.  No one knows.  But I wouldn't be this excited if I thought they were going to $0."

Oftentimes (especially if they are a BitTorrent user) they tend to leave pretty excited and promising to go hit Google ASAP.  I suppose such an exchange costs me a 1 BTC casascius coin, but I really do believe people keep them like treasure.  I gave away a LOT of Casascius Coins at CES.

[Technomage]

I suppose such an exchange costs me a 1 BTC casascius coin, but I really do believe people keep them like treasure.  I gave away a LOT of Casascius Coins at CES.

This is why your physical coins are so useful. I gave away a lot for Christmas gifts and I've given them away in conversations as well. I ordered a bunch of coins in November and I'm all out except for the ones that I keep for myself. Need to order more soon.

Regarding the OP, I agree that BitTorrent is a very good analogy to use if the person knows what it is. We need ways of making the connection with different type of people though, BitTorrent works well with tech-oriented young people but not so well with some other types of people.

[Epoch]

I suppose such an exchange costs me a 1 BTC casascius coin, but I really do believe people keep them like treasure.  I gave away a LOT of Casascius Coins at CES.

This is why your physical coins are so useful. I gave away a lot for Christmas gifts and I've given them away in conversations as well. I ordered a bunch of coins in November and I'm all out except for the ones that I keep for myself. Need to order more soon.

Regarding the OP, I agree that BitTorrent is a very good analogy to use if the person knows what it is. We need ways of making the connection with different type of people though, BitTorrent works well with tech-oriented young people but not so well with some other types of people.

BitTorrent is often associated with software/music/movie piracy. True or not, I'm not sure that associating bitcoin with BitTorrent is sending a particularly positive message. 

[rebuilder]

I've been emphasizing that it's the first decentralized currency to provide decent protection against counterfeiting. That's the number one feature of Bitcoin IMO. Technically it might be the first decentralized currency, period, since without protection against counterfeiting there's little point to a currency, but that's getting a bit far into it for first impressions.

[paraipan]

I suppose such an exchange costs me a 1 BTC casascius coin, but I really do believe people keep them like treasure.  I gave away a LOT of Casascius Coins at CES.

This is why your physical coins are so useful. I gave away a lot for Christmas gifts and I've given them away in conversations as well. I ordered a bunch of coins in November and I'm all out except for the ones that I keep for myself. Need to order more soon.

Regarding the OP, I agree that BitTorrent is a very good analogy to use if the person knows what it is. We need ways of making the connection with different type of people though, BitTorrent works well with tech-oriented young people but not so well with some other types of people.

BitTorrent is often associated with software/music/movie piracy. True or not, I'm not sure that associating bitcoin with BitTorrent is sending a particularly positive message.  

the people using bittorrent in fact know they aren't doing anything illegal and get allot of benefit from it  

[PrintCoins]

It is a digital currency running on a peer-to-peer network similar to bittorrent. Only a limited quantity will ever be produced, and there is no central authority that will ever be able to undermine that. Bitcoins can be sent over the internet with virtually no transaction fees and with a fair degree of anonymity.

Some people use it just to speculate on its value (it has swung between 50 cents and $30 a bitcoin over the last year).

There are (hundreds, thousands...?) of merchants online that will sell virtual and real goods that will sell things such as coffee, apparel, and even illegal drugs (if you are into that sort of thing).
--
Many of these statements open up the other person to asking questions. I think this is better than just an elevator speech. You want to leave openings for them to ask questions.

If they are into the drugs thing, explain about the silk road. Some fence sitters will become instant converts once they see the actual site.

If not so much, show them a couple sites you have bought things on.

Set them up with an address on strongcoin, and send them a coin (or just keep a couple bitcoin cheques in your pocket (not necessarily from printcoin.com)).