What Is Bitcoin

What is Bitcoin?

I am often asked that question. Bitcoin is a form of electronic currency. Just like you can use PayPal to pay for an online order, you can now use Bitcoin at more and more locations to make online purchases. But, unlike PayPal, which is linked to your bank account, Bitcoin doesn't involve the banks at all.

Bitcoin is a decentralized currency, meaning there is no one person or entity that controls it. The whole Bitcoin "universe" is distributed across hundreds of thousands, if not millions of peer-to-peer networked computers. There is no one bank, country, or server that could fail and take down Bitcoin. Traditional money is called a "fiat" currency. Fiat currency is money that a government has declared to be legal tender for a country. Bitcoin is not a fiat currency.

If you Google your questions you'll find lots of different answers to it. It is worth taking the time to read through some of them. Here's a short article from Coin Desk titled "What is Bitcoin". I think it is a great place to start.

Also, watch out for the term "blockchain". While Bitcoin is certainly interesting, blockchain is really the amazing invention that allows Bitcoin to work. If you can read up on it and get a basic understanding of what blockchain is, you'll understand how pretty much any of the new breed of Crypto-Currencies work.

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