The value of bitcoin briefly fell below the $10,000 mark last night as the controversial cryptocurrency moved further away from its late December peak. It later bounced back above $11,000 - continuing a trend of extreme volatility for the standard. 

But what exactly is bitcoin and what does it offer those who hold it?

"Bitcoin is effectively a digital asset or cryptocurrency," said Lory Kehoe, who is EMEA Blockchain Lab Leader at Deloitte. "With it I can exchange a bitcoin or part of a bitcoin directly with you, without going through a bank or intermediaries, with the goal of making the transaction cheaper, better and faster."

Conventional currencies are backed by governments, national economies and central banks - which in turn hold assets like gold - but none of that applies to bitcoin. Instead, the price of a coin is simply based on what people are willing to pay for it at any given time. That goes some way to explaining how volatile the price of a cryptocurrency tends to be. Many people also appear to buy bitcoin as an investment - rather than to hold as a currency - which has led to its sharp spike in valuation in recent months.

"What we've seen is that people are increasingly starting to use bitcoin as a store of value, so what they see it as is digital gold - or gold 2.0," Mr Kehoe said. "During periods of geopolitical uncertainty, people are fleeing to bitcoin or digital gold rather than gold itself, which is a really interesting development that we've seen over the last 12-18 months."

But Bitcoin has been met with plenty of opposition from the investment community - with the heads of Goldman Sachs and JP Morgan, as well as Warren Buffett, warning people to steer clear of the cryptocurrency. 

Mr Kehoe accepts that these people are experts in their field, but suggests they may just be wary of what they do not understand. "If they don't fully understand something the answer is easily 'no', or if it threatens existing business models or operating models the easy answer is 'no'," he said. "If you combine confusion and threat the easy answer is 'I don't like this, we're not doing it, let's shut it down'."

However Mr Kehoe suggested that users should look passed bitcoin itself and towards the underlying technology - Blockchain. This is a digital ledger system that records all transactions and has been pointed to as a major development for financial services, even by those who regard bitcoin as a scam. 

Mr Kehoe also warns that there are a few hurdles involved for those who decide to invest in bitcoin. For example they need to set up on an exchange, which generally involves getting their identity confirmed and having a bank account established in another country. Should they strike it lucky and eventually have a profit to take home, they may also find the bank "red flagging" a transfer if it is seen as unusual activity. Revenue is also sure to take an interest if there are capital gains that could be taxed, he added.

MORNING BRIEFS - Clothing retailer Penneys has reported a 7% rise in sales in the 16 weeks to the start of January. The company, which trades as Primark in other countries, said it enjoyed record sales in Europe in the weeks leading up to Christmas, while its relatively new operations in the US continued to make progress. Penneys' parent company AB Foods also owns a number of consumer brands including Twinnings and Ryvita. Its overall revenue was up 4% in the period.

*** Apple will pay $38 billion in tax on the $252 billion in cash it holds offshore, the company has announced. The cash pile includes money earned outside of North America, which Apple sends through its Irish operations. The payment is part of a new law in the US which requires companies to pay a one-time tax on foreign-held earnings whether they intend to repatriate them or not.

*** Whitbread has reported a 5.6% rise in sales in its third quarter, although like for like sales in Britain only grew by 0.3%. The company blamed tough market conditions on the performance, and said weak retail market footfall was having a particularly negative impacting on its Costa Coffee business.

*** Halfords Group saw a 2.7% rise in sales in its third quarter, but said it expected the British retail sales environment to remain subdued for the rest of the year.

*** China's economy grew by 6.9% in 2017, picking up steam for the first time since 2010. The official figures released this morning was ahead of analyst expectations and government forecasts of 6.5% growth.