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Essential pointsBitcoin is an electronic currency known as a cryptocurrencyThe peer-to-peer technology underpinning it's known as the blockchain a people ledger of all transactionsBitcoins can be stored in a digital wallet and used to buy 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 individuals mined thousands of comparatively worthless bitcoins as a hobby years ago, only to now realise they are rich.One IT worker even threw out a hard drive containing 7,500 bitcoins.

This is done without a central authority or bank.Who generated itBitcoin and also the blockchain technology was made by someone under the pseudonym of Satoshi Nakamoto and published as a working beta in 2009. Satoshi's true identity remains a puzzle 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 the years numerous people have claimed 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 decimal place (0.00000001BTC) to purchase smaller goods using just a fraction of these coin.How do you shop or send bitcoinYou can store and send bitcoins via an encrypted digital wallet, which is run as a program on your computer.The wallet works 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 functions as a password that unlocks the wallet and allows you to send any bitcoins associated with it.

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If the web site gets hacked or someone gets your login information they can access and drain your funds from the exchange.There is no way to get a transaction to be reversed or recovered if a burglar sends your bitcoins to their wallet.After buying your coins you need to transfer them into a secure digital wallet created by you and not hosted online.You can even write down the pocket's personal key on a piece of paper (that is known as a newspaper wallet) and her response stick it in a safe.If you don't store the private key on your pc or online then recipients 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 others, it's a purely digital entity of questionable value and dubious origin. But what's Bitcoin, in the most basic senseIn most casual conversations, you can get away with knowing that bitcoin is, essentially, a digital currency.

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In reality, it is two much 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 platform is built on the concept of evidence of work data which is expensive and time-intensive to produce but can be readily verified.

To mine a bitcoin, a computer must finish a complicated algorithm, essentially going through the work of an extensive calculation in exchange for a few newly minted currency. That piece of digital currency is worth whatever the market determines through supply and demand.Transactions are connected to a users Bitcoin speech, which can be saved on its own general ledger, called the blockchain.

This comparative anonymity makes the system appealing for things like incognito purchases over the internet.A key component of Bitcoins blockchain is the fact it is an open, distributed ledger. Throughout the distributed nature of this ledger, the transactions on the blockchain are verified 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 exactly what Bitcoin (or bitcoin) is: that there is no single answer.