Bitcoin is a digital currency that doesn’t have a central issuing authority. Instead, it uses peer-to-peer technology to both create the supply of Bitcoin and manage transactions.
Bitcoin is an actual currency, rather than a simple electronic wallet or payment system. I suggest you go and read the background information to understand how this works.
As you would imagine, the authorities are getting concerned about the fact it is unregulated and is being used for criminal activity as an alternative to old fashioned cash. Others are just worried this is a scam. I’ll let you judge for yourself.
The SMH describes Bitcoin as:
an unstable virtual currency championed by hackers and other cyberpunks and available through several online exchanges.