Video: What is Bitcoin? Lesson 01

What is Bitcoin?

Bitcoin, often described as a cryptocurrency, a virtual currency or a digital currency - is a type of money that is completely virtual.

It's like an online version of cash. You can use it to buy products and services


Like paper money and gold before it, bitcoin is a currency that allows parties to exchange value. Unlike it predecessors, bitcoin is digital and decentralized.

For the first time in history, people can exchange value without intermediaries which translates to greater control of funds and lower fees.

How Does Bitcoin Work?

Each Bitcoin is basically a computer file which is stored in a 'digital wallet' app on a smartphone or computer.

People can send Bitcoins (or part of one) to your digital wallet, and you can send Bitcoins to other people.
Every single transaction is recorded in a public list called the blockchain.

This makes it possible to trace the history of Bitcoins to stop people from spending coins they do not own, making copies or undo-ing transactions.

Why Use Bitcoin?

You use bitcoin for many of the same reasons you opt to send an email, stream a movie, or download a song. It’s faster, cheaper, more secure and immutable. And its uses extend beyond the peer to peer payments.

In many places, bitcoin is less volatile than the local currency so some use it to store value while others use it to consume at hundreds of thousands of vendors across the globe and online.

 


Watch out for Lesson 2

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