Saying that bitcoin is the most popular cryptocurrency has little impact in a world that does not understand the word cryptocurrency. Bitcoin exists as a distinct alternative from plastic money (credit cards) that are identifiable. Even PayPal transactions can be traced to individual bank accounts. Bitcoin is the equivalent of cash used for under the table payments for goods or services. The infamous Silk Road, an eBay-style black market for illegal goods and services needed a non-traceable payment system and used bitcoin. Silk Road has ceased to exist, and its developer is serving a life sentence for the actions of this nefarious and illegal enterprise.
What is bitcoin to be used for then? It has extensive uses in online gambling and making investments in the world markets. Bitcoin offers great opportunities in the financial world where its value increases over time like many stocks. It works for transactions between companies and per-use programs. Many applications flooding the market with new programs will soon be pay-per-use. These minuscule per-use charges could not function with PayPal or with credit card transactions due to processing fees.
Bitcoin can be used for transactions that take place without being recorded.
Bitcoin is limited by its network and transaction speed. Visa can handle 2000-4000 transactions a second while the bitcoin rate is 7 transactions per second. Bitcoin operates as an unregulated cryptocurrency; it is not designed to replace PayPal as the many other PayPal-like programs are attempting.
What bitcoin is, is an untraceable currency exactly like cash. We pay taxes on profits made by our businesses or for wages earned and recorded on W-2 forms. This money has been taxed and is ours to spend in any way we wish, but there are times when credit cards and PayPal transactions leave a traceable record of our activities. As businesses, most transactions are made by check or credit card, but those made with cash present a choice for businesses. They can claim the cash transaction and pay taxes on the money received, or in the case of unscrupulous business owners can hide the money and cook the books accordingly.
Bitcoin is an exciting new concept and can be of great use for ethical transactions without traceable records, but in the hands of the unscrupulous can be a way to avoid paying taxes.