Bitcoin has gone up and down recently, and even the Treasury Department is jumping into the virtual currency's fray. Some argue, however, that the monetary program isn't really a currencyat all.

Comedian Stephen Colbert tackled the controversial Bitcoin on his show Wednesday night.

"Essentially the online world is the central bank here. Just imagine if the Federal Reserve was taken over by GameStop," Colbert said, referring to the largest video game retailer. "How does this unregulated, imaginary currency invented by an anonymous hacker, backed by the full faith and credit of YouTube comments ever go wrong?"

Colbert brought on Adam Davidson, of NPR's Planet Money to weigh in on the new digital currency. Davidson recommended that no one buy Bitcoin, though he highlighted one perk for people who prefer the shadows: "The great thing about Bitcoin — for someone who wants to do something shady, there's no way to track you," Davidson said.

Those who have made a mint on Bitcoins might need to hand information over to the IRS anyway, to avoid potential tax fraud.