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Essential pointsBitcoin is a digital currency known as a cryptocurrencyThe peer-to-peer technology underpinning it is known as the blockchain a people ledger of all transactionsBitcoins can be stored in a digital wallet and used to Purchase other currencies or actual 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 people mined thousands of comparatively useless bitcoins as a hobby years ago, only to now realise they're rich.One IT employee even threw out a hard disk containing 7,500 bitcoins.

This is done with no central authority or bank.Who generated itBitcoin and also the blockchain technology was created by someone under the pseudonym of Satoshi Nakamoto and released as a working beta in 2009. Satoshi's true identity remains a mystery as he vanished from the scene in 2010 after seemingly handing over the reins into Gavin Andresen, the chief scientist at the Bitcoin Foundation.Over years numerous individuals have promised to be 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 eighth decimal place (0.00000001BTC) to buy smaller goods using only a fraction of these coin.How would you shop or send bitcoinYou can shop and send bitcoins from an encrypted digital wallet, which is run as an app on your computer.The wallet functions with two keys 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 allows you to send any bitcoins associated with that.

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In case the web site gets hacked or someone gets your login details that they can get and drain your funds from the exchange.There is no way to get a transaction dig this to be reversed or recovered if a burglar 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 pocket's personal key on a piece of paper (this is known as a newspaper wallet) and stick it in a safe.If you don't save the private key on your computer or online then hackers can never break in and get your funds.

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

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

To mine a bitcoin, a computer has to finish a complicated algorithm, essentially going through the job of an extensive calculation in exchange for some newly minted currency. That piece of electronic currency is worth whatever the market decides through supply and demand.Transactions are connected to a users Bitcoin speech, which is saved on its 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 it is an open, distributed ledger. Through the distributed nature of the ledger, the transactions on the blockchain are confirmed by the consensus of each member, offering protection and trust without a third-party overseer.One of the most important things to bear in mind when thinking about what Bitcoin (or even bitcoin) is: that there is no single answer.