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Key pointsBitcoin is an electronic currency known as a cryptocurrencyThe peer-to-peer technology underpinning it is known as the blockchain a people ledger of transactionsBitcoins can be stored in a virtual wallet and used to Purchase other currencies or real world goods

Where once a single bitcoin has been worth a few cents it's now worth about $9,200 per coin (November 2017), creating millionaires in the process.There have been many reported cases where individuals mined thousands of relatively useless bitcoins as a hobby years back, only to now realise they're rich.One IT worker even threw out a hard disk containing 7,500 bitcoins.

This is done without a central authority or bank.Who created itBitcoin and also the blockchain technology was made by someone under the pseudonym of Satoshi Nakamoto and released as a working beta in 2009. Satoshi's true identity remains a puzzle as he disappeared from the scene in 2010 after seemingly handing over the reins into Gavin Andresen, the chief scientist in the Bitcoin Foundation.Over years numerous people have promised to become Satoshi, including Australian computer scientist Craig Wright.

Once the limit is reached, no longer bitcoins can be made.However, a single bitcoin can be subdivided as far down as the decimal place (0.00000001BTC) to purchase smaller goods using only a fraction of these coin.How would you shop or send bitcoinYou can shop and send bitcoins via an encrypted electronic wallet, which is run as a program on your computer.The wallet works using two keys that a private key and a public key which seem like a seemingly random string of numbers and letters.The private key is kept confidential by you and acts as a password that unlocks the wallet and lets you send any bitcoins connected with it.

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In case the web site gets hacked or someone gets your login information that they could get and drain your funds from the exchange.There is no way to get a transaction to be reversed or recovered if a thief sends your bitcoins for their wallet.After buying your coins you should transfer them to a secure digital pocket made by you and not hosted online.You can even write down the wallet's private key on a sheet of paper (this is known as a newspaper wallet) and stick it in a safe.If you don't store the private key on your computer or online then hackers can never break in and access your funds.

Bitcoin means different things to different individuals. For some, it's a future of freely moving currency untied to any central bank. To the others, it's a purely electronic entity of questionable value and dubious origin. However, what is Bitcoin, in the most elementary senseIn most casual conversations, you can eliminate knowing that bitcoin is, basically, a digital currency.

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In fact, it is two considerably more complex things.Bitcoin has been with us since 2009, when a person (or group) under the pseudonym Satoshi Nakamoto introduced a platform (Bitcoin, uppercase) that hosts an electronic currency (bitcoin, lowercase). Bitcoin the stage is built on the concept of evidence of work data which is expensive and time-intensive to create but can be readily verified.

To mine a bitcoin, a computer has to original site complete a complicated algorithm, essentially going through the work of an extensive calculation in exchange for some newly minted currency. That piece of electronic currency is worth whatever the market determines through distribution and demand.Transactions are connected to some users Bitcoin address, which is stored on its own general ledger, called the blockchain.

This comparative anonymity makes the platform appealing for things such as incognito purchases over the internet.A key component of Bitcoins blockchain is the fact that it is an open, distributed ledger. Through the distributed nature of the ledger, the transactions on the blockchain are confirmed by the consensus of every member, offering protection and trust without a third-party overseer.One of the most important things to bear in mind when thinking about exactly what Bitcoin (or even bitcoin) is: there is no single answer.