My problem with BitCoin is piracy. I keep reading articles in Ars Technica and Gizmodo and whatnot about these "BitCoin Mines" where the pirates use custom-built desktops with immense amounts of computing power to decrypt BitCoin transactions and steal the value. I don't really understand the details, but it doesn't seem to me at all as secure as the inventors would have us believe. I also don't at all understand how you'd access the BitCoin economy or how you'd take part in it; how you'd earn BitCoins or how you'd spend them. (I've yet to actually look it up, though.)

I'll get to password-cracking after I mention the BitCoin economy. It's like asking, "How do I get into USD$, anyway?" You could visit an exchange and pay some money, or find a friend locally. I just used PayPal to send CAD as AUD to get some BTC.
The main point of getting BitCoin would be for online purchases. It's also meant as a value store.
Things are a bit weird right now because it's still the birth of the currency and the value is largely in flux. More and more online stores are accepting BitCoin for purchases. Microsoft was taking them a year ago. A bunch of places are going to settle on a trustworthy escrow provider to manage transactions, because it's about as unprotected as cash in that way.
BitCoin is divisible into hundred-millionths, so if it ended up growing to $1,000,000.00 each, you could still shuffle individual pennies around. I've got 0.01100001 BTC on my phone, just to have it there.



Are you familiar with how passwords are stored on enterprise systems? They are hashed to a long random value, so that it becomes exceedingly hard to guess at the answers.

A really good single-purpose hashing computer could do something like 2,000,000,000,000 hashes per second. If you've got a password hashed with SHA-256, it'll take 2^256 hashes, or about 1157920892373161954235709850086900000000000000000000000000000000000000000000 hashes, to get through the entire set. At 2 TH/s, it would still take over 300 sextillion years. Even a performance increase of several orders of magnitude aren't enough to brute-force this.
There are a couple tricks, like how some older hashing algorithms have flaws that make them easier to crack, but in general you're relying on the mixing of numbers and using the raw lottery odds to drive criminal interest down.

If anything is the matter, it's poor passwords. In the enterprise system I mention above, a hacker will use a library of known passwords and sets of rules (like using a 0 instead of an O) to check for weak passwords. If he tries searching for well-used pieces of text like 'p455w0rd', he'll find a bunch of matches in accounts that are using short words. The same kind of attack works on exchanges or online wallets. That's what people are cracking, and it's been a problem throughout the history of online things. Even phone systems, back in the day.
(A list of twelve uncommon words makes a pretty good password, and that's what some BitCoin wallets use. Look up "correct horse battery staple".)

There are ways to secure your wallet. You can store it offline, and use a public service to keep track of the amounts in your addresses. You can create transactions on the disconnected wallet, and transfer them to a live computer using a USB stick, or by displaying a big QR code and taking a picture with another device.

You see? This is why I try not to be afraid to look ignorant in front of people who know more than me. That was a much better summary of the matter than I've seen in any online news services.

...so it's like Windows? I don't need to worry about how BitCoin works technically, just that it's a currency like any other, only independent of nation states?

Seeing as how you can potentially be storing a lot of value, it makes sense to know generally where that's stored. All you need to know is that you would have a very long and crazy string that you can use to prove you own an amount, and use that to move the amount by using an application to send a transaction to the peer network.

Frankly, you don't even need to know how much you have, as long as you know you have enough. Making a transaction is like writing a cheque. I could give you a transaction and then tell you to cash it in a few days.

I do have a BitCoin wallet, and i have tried some mining, but mining is EXTREMELY slow and so far i haven't made anything worth noting.
I can very well see bit coin becoming more used in the future for mostly online transactions. Right now i am just waiting for it to grow a bit more, the future is uncertain but full of possibilities.
I do not have PayPal, nore have i done very much with BitCoin so it is hard for me to say at this point.
See you in the future.

All big things have alternatives. In this market, the alternative to BitCoin is LiteCoin. It's based on the same open-source project, but releases coins four times as often.

At this moment, mining LiteCoin is 25x more profitable than mining BitCoin. You can transfer those funds to an exchange and then trade your LiteCoin for BitCoin (right now, it's 0.036 BitCoin for 1 LiteCoin, or roughly $36). A good Radeon can make a few coins per week, at the moment, which is actually a pretty good return.

LiteCoin uses a more memory-intensive hashing algorithm, which mean single-purpose machines haven't been created for it, yet. Arrays of graphics cards are still the most powerful thing to mine them with.
BitCoin, meanwhile, is completely useless to mine without a single-purpose $4000 miner that'll be obsolete in three or four months.

Do you get Humble Indie Bundles? They take BitCoin. You can get a bundle for a few milliBitCoin.