What is Bitcoin? The Original Cryptocurrency Explained

Crypto Decoder
May 28
2 min read

Updated: Jun 3

Bitcoin is the coin that started it all. Launched in 2009, it introduced the world to a new way of thinking about money—decentralized, digital, and borderless. In this post, we’ll break down what Bitcoin is, how it works, and why it’s such a big deal.

What is Bitcoin?

Bitcoin (BTC) is a form of digital currency that allows people to send and receive value over the internet without relying on banks. It was invented by an anonymous person or group using the name Satoshi Nakamoto and launched as open-source software in 2009.

How Does Bitcoin Work?

Bitcoin runs on a technology called blockchain, which is like a public, digital ledger. Every time someone sends Bitcoin, the transaction is verified by a network of computers (called nodes) and recorded on this ledger.

Key Features:

Decentralized (no single authority controls it)
Limited supply (only 21 million BTC will ever exist)
Peer-to-peer (you can send it directly to anyone, anywhere)

How is Bitcoin Created?

Bitcoin is created through a process called mining. Miners use powerful computers to solve complex math problems. When they solve one, they earn new Bitcoins and help verify transactions.

This process ensures security but also uses a lot of electricity, which is why Bitcoin is often criticized for its environmental impact.

Why Do People Buy Bitcoin?

People buy Bitcoin for many reasons:

Store of value: Some view it as “digital gold.”
Hedge against inflation: Its fixed supply appeals to those worried about traditional currencies losing value.
Investment: Many believe Bitcoin will grow in value over time.
Freedom: It’s decentralized and doesn’t rely on banks or governments.

Is Bitcoin Safe?

Bitcoin itself is secure thanks to blockchain technology. But how you store it matters - using a secure wallet and protecting your private keys is crucial.

Its price can also be very volatile, so it’s important to do your research and invest responsibly.

Bitcoin is the foundation of the entire cryptocurrency movement. Whether you’re curious about investing or just want to understand the future of money, knowing how Bitcoin works is a great place to start.

Next up: What are Altcoins and how do they differ from Bitcoin?