What is Bitcoin?
A decentralized digital currency created in 2009 by the pseudonymous Satoshi Nakamoto. Bitcoin enables peer-to-peer payments without banks, governments, or intermediaries. Its supply is capped at 21 million coins, enforced by code rather than policy.
Why It Matters
Bitcoin is the first successful attempt at creating digital money that doesn't require a trusted third party. Before Bitcoin, every digital payment required a bank, payment processor, or government to verify that you actually had the money and hadn't spent it twice. Bitcoin solved this "double-spending problem" using a combination of cryptography, a distributed network, and Proof of Work. The result is money that no single entity controls. No one can print more bitcoin, freeze your account, or reverse your transactions. Bitcoin's fixed supply of 21 million coins makes it fundamentally different from government-issued currencies, where central banks can create new money at will. This scarcity, combined with growing adoption, is what drives Bitcoin's value proposition as both a payment network and a store of value.
How It Works
Bitcoin runs on a peer-to-peer network of thousands of computers called nodes. When you send bitcoin, your transaction is broadcast to the network and collected into a block by miners. Miners compete to validate blocks by performing computational work (Proof of Work), and the winner adds the block to the blockchain, a permanent public ledger. Each block references the previous block, creating an unbreakable chain of transaction history going back to the Genesis Block in January 2009. Your bitcoin is controlled by a private key, a secret number only you know. The network enforces all rules automatically, including the 21 million supply cap, the halving schedule that reduces new bitcoin creation every four years, and the difficulty adjustment that keeps blocks arriving every 10 minutes on average.