What is Bitcoin?
The plain and simple answer is that Bitcoin is digital currency. Bitcoin is becoming more popular each and every day. Everyone wants to know how it works, obviously, it is new, and it is money. The how it works is absolutely available to you, because Bitcoin is Open-Source. That means that every bit of the code that creates it, is accessible to any programmer that wants to look at the ins and outs of the coin.
But let me ask you a few questions. How does the banking system work? Do you know exactly how the dollar is made? Do you know how the dollar gets circulated after it is made?
I will tell you this, it is a confusing and overwhelming process to understand how it all works. But you still use that dollar don't you? That is the thing with Bitcoin. If you want to understand how it all works. Feel free to visit bitcoin.org and start diving into all the ins-and-outs of the coin.
Let us focus on the important aspects of Bitcoin and all CryptoCurrencies.
- Bitcoin is a Digital Currency
- Bitcoin is kept in your Digital Wallet (Software Wallet for Computer / Mobile Device)
- You can Buy things with Bitcoin
- You can Sell things with Bitcoin
- It is not 100% Anonymous
- Bitcoin gets traded around the world on different Currency Exchanges
The Value of Bitcoin changes constantly because it is exchanged like every other currency. Think of this like Stocks that are traded. The value of a $1 stock could be worth $0.90 today and $1.10 tomorrow. Until you sell your stock nothing is definite. Once you sell, then that amount of money is yours. The same works with Bitcoin. One day it might be worth $375.25 and the next it could be $415 or even $326.