What is Bitcoin?
Bitcoin is a cryptocurrency; in other words, a currency that does not consist of physical bank notes and coins, but of a sequence of encrypted data blocks.
Every transaction in a cryptocurrency – including every Bitcoin transaction – is held online in a block. Every transaction has a unique digital signature. As soon as the transaction is verified by everyone else in the system, the block is attached to the “chain” and the money changes hands. The “blockchain” is a logbook which can be viewed by everyone else and cannot be erased. It is a kind of virtual set of accounts in which every transaction is entered and can be checked and tracked by everyone at all times.
The name Bitcoin is an invented term made up of “Bit” (the smallest unit of computer memory) and “coin”.