Bitcoin is a cryptocurrency and a payment system, first proposed by an anonymous person or group of people under the name Satoshi Nakamoto in 2008.
Bitcoin is a decentralized system, meaning there is no central authority or middleman controlling the currency. Transactions are instead verified by a network of nodes, or computers, through a process known as mining.
Bitcoin can be used to buy things electronically, in the same way that conventional fiat currencies can be used to buy things.
Bitcoin is often referred to as a digital or virtual currency. That’s because bitcoins only exist electronically – there is no such thing as a physical bitcoin.
Bitcoins are created through a process known as mining. Miners are rewarded with bitcoins for verifying and committing transactions to the blockchain, the public ledger of all bitcoin transactions.
This process requires significant computational power, which is why miners are typically large organizations with access to lots of resources, such as data centers and special hardware called ASICs.
Once mined, bitcoins can be sent from one person to another, or from one wallet to another. All transactions are recorded on the blockchain, ensuring that bitcoins cannot be double-spent.
Bitcoins can be used to buy goods and services online, or can be held as an investment. Some people view bitcoin as a store of value similar to gold, while others see it more like a commodity like oil.
Investing in bitcoin can be risky, as the price is highly volatile and has been known to crash suddenly. However, many people believe that bitcoin has long-term potential as a store of value and believe it will eventually become more mainstream.