If you've ever left a chocolate bar sitting around, you may have noticed a white film form on the surface. This film is called a "bloom" and it occurs when chocolate is improperly stored.
Photo by Everjean.
According to Cook's Illustrated, chocolate blooms when it gets too warm, or if water condenses on the chocolate:
Cocoa butter bloom occurs when the chocolate softens so much that the cocoa butter crystals melt and molecules of fat migrate to the surface where they form new crystals. Sugar bloom happens when water condenses on the chocolate and dissolves some of its sugar. When that water evaporates, a fine layer of sugar crystals is left behind.
Here's the good news: Bloomed chocolate isn't ruined, though its uses are a bit more limited. Though you can't use it for dipping -- it won't set well and the bloom will reappear -- you can certainly use it for baking, and chocolate chip cookies made with bloomed chocolate will taste no different than those made with perfectly shiny chocolate. You can also just eat it as is. It may not be as pretty, but your mouth won't care.
Can bloomed chocolate still be used in cooking applications? [Cook's Illustrated]