SwitchPoker.com, a small independent online poker room, became a trailblazer this week, becoming the first internet poker room to accept Bitcoin as a valid currency for both deposits and withdrawals.  Bitcoin is a unique currency, as it is purely virtual and does not require financial institutions to process transactions.

Bitcoin was created in 2009 by Satoshi Nakamoto as completely virtual currency that is not backed by any government or anything tangible, such as gold or silver.  They are transferred through a peer-to-peer (P2P) network without any need for a bank.  In fact, all transactions and account balances are logged on the network; there is no central server or anything like that where all of the Bitcoins are counted.  Each Bitcoin user’s software client (which is free and open source, by the way), keeps track of all transactions anonymously, including the creation of new Bitcoins.