Digital currencies, like Bitcoin, use a mechanism called the blockchain to perform transactions. The blockchain is essentially a shared public ledger that everyone can inspect and no single person controls. Those using the system keep it up to date to continuously keep track of transactions.

The blockchain technology, though, holds promise beyond Bitcoin. Some have proposed using the technology for public databases, like titles to land or other goods. According to recent article from the Economist, the NASDAQ is even about to start using the technology to record trading in securities of private companies.

Blockchain technology is expected to reach its tipping point in the next few years, and by 2023, it's predicted that the first government will collect taxes using the technology.