Bryan Chaffin:

Bitcoin is first and foremost a virtual currency. It is also a decentralized currency, meaning that there is no one person or party in charge of it. It’s not backed by a government or any form of hard asset, which means that its value is protected only by the integrity of a distributed network of accountability and the willingness of people to accept them for goods or services.

A really helpful guide from Bryan at The Mac Observer to help understand what Bitcoins are and why people are so interested in them.