Bitcoins, virtual gold coins emblazoned with the letter B, look like the currency of video game aficionados and computer science graduates rather than a legitimate medium of exchange. But for those who are paying attention, bitcoin is beginning to look increasingly attractive as a financial tool and as an investment.

To date, consumers have been slow to embrace bitcoin. In a recent report by the Digital Currency Council, 74 percent of respondents said they are highly unlikely to use bitcoin in the next year. Those who do use it tend to be young, between 18 and 24 years old. The digital currency’s popularity is also higher among nonwhites and those with lower household incomes.

But the lack of consumer interest hasn’t stopped investors from sniffing around bitcoin. In fact, according to Coinbase, a bitcoin wallet and exchange company with about 3 million users, 80 percent of those users are buying, selling and holding bitcoins as investments, while only 20 percent are using them for day-to-day spending.

As an investment, bitcoin has been unpredictable. Its value has fluctuated wildly, from less than 1 cent at its launch to a peak of more than $1,200 a couple of years ago. For the past few months, it has held steady at around $400. At that price, it may be trading at a discount. According to Spencer Bogart, an analyst covering bitcoin for Needham, the current value of bitcoin should be $655. If he’s right, there’s significant upside potential for anyone willing to buy in now.

“Today, people investing in bitcoin are doing so in a speculative nature. This is for sure a high-risk, potentially high-rewarding investment,” said Michael Sonnenshein, director of sales and business development at Grayscale, which sponsors the Bitcoin Investment Trust (OTCMKTS:GBTC). “That’s one of the reasons why a lot of people are excited about investing in this space.”

Bitcoin’s true value as an investment likely lies in its enabling technology, called blockchain, rather than its potential as a digital currency. Just as the internet transformed the way we share information, blockchain promises to do the same for financial services.

The technology works almost like a shared Google Sheets spreadsheet, allowing multiple parties to view, edit and validate a transaction, eliminating the need for a middleman. Successful tests with mainstream banks such as Citigroup and JPMorgan Chase have shown that blockchain can indeed cut costs and make financial transactions more efficient.

“In 10 years there may be no more stock exchanges and far fewer banks and so forth. All of these things can be made 90 percent cheaper by introducing this technology,” said David Yermack, chairman of the finance department and a professor at New York University Stern School of Business. “Financial services are going to get a lot cheaper for most people.”

If blockchain continues to gain traction, everything from buying homes to using debit cards could be drastically different in the near future. In an industry that has been extremely resistant to change, the implications for financial institutions that do not adapt to the emerging technology could be devastating.

Widespread implementation of bitcoin and blockchain technology is not without challenges. One of its biggest limitations at the moment is speed. While PayPal can process thousands of transactions per second, the bitcoin network maxes out at 7 transactions per second. Expanding that capacity is crucial to its success, obviously, but how best to accomplish that is not widely agreed upon. Possible problems with privacy and fraud protection will also need to be resolved before bitcoin’s potential can be fully realized.

It remains to be seen whether bitcoin and blockchain will reach the tipping point of mass adoption. Because the technology is relatively new and rapidly changing, predicting its future value is particularly challenging. It’s something that would-be investors have to consider.

“A lot has happened in this space that was very hard to predict even a year ago. You get the sense that if you look forward a year into the future that there is going to be a lot more that at this point is hard to forecast,” Yermack said. “I don’t rule out the possibility that something completely new will overtake [bitcoin] because we certainly saw that in early years of the World Wide Web.”

For those willing to take the risk, the most direct way to invest is to purchase bitcoin through an online exchange such as Circle, Coinbase or Kraken. It doesn’t take much to get in the game. “We think of bitcoin as being a whole unit, but it’s actually divisible. What that means is you can buy $1 of bitcoin or $2 of bitcoin and you would get a fraction of it,” said Chris Burniske, a thematic research analyst at ARK Invest.

According to Burniske, bitcoin can be a good way to diversify your portfolio, but certainly shouldn’t be the only investment you hold.

“While it’s a scary thing to say, [bitcoin] could go to $10,000 or it could go to $0,” Burniske said. Unless you’re tracking it carefully, it’s better to buy and hold a small amount with a long-term perspective, he said. “In which case, a 1 to 2 percent position is a really smart thing to do,” he said.

Another option, especially for those who want to add bitcoin to their retirement portfolios, is the Bitcoin Investment Trust. As an investment vehicle, it operates like a stock or an exchange-traded fund, and each share represents about one-tenth of a bitcoin. However, it trades on a secondary market, which means its price is not always precisely aligned with the price of bitcoin, but rather by how many investors are currently willing to buy or sell shares. Still, for those who are not comfortable buying and selling bitcoin directly, it is a good option.

Of course, not everyone agrees bitcoin deserves a place in your investment portfolio. “Any finance professor will tell you you should be diversified and own the market index,” Yermack said. “The excitement here is really as a customer, not as an investor.”