As the financial system in parts of the world crumbles, the decentralised digital currency Bitcoin has rocketed to a market capitalisation of almost $1.2 billion in what some believe is a sign the boom will soon turn to bust.

Bitcoin is an attempt to create a decentralised, crypto currency with no governments or central banks in control (see video). Transactions can be virtually anonymous, and the currency can be bought and sold at online exchanges.

Bitcoins. Credit:Flickr/zachcopley

One bitcoin is at the time of writing worth $A110 or $US115 - up from around $US50 in mid-March and below $US15 in January. There are almost 11 million bitcoins in circulation.

There have been reports that Europeans have been ploughing money into bitcoins after losing faith in governments and financial institutions - highlighted by the recent banking crisis in Cyprus - and the unstable euro.