What Is Bitcoin?

Bitcoin (BTC) is a type of digital money that you can use to send or receive payments online. It doesn’t belong to any bank, company, or government. This means people can send money directly to each other without needing a bank or middleman.

Bitcoin was created in 2008 by someone (or a group of people) using the name Satoshi Nakamoto. It was the first cryptocurrency ever made and is still the most popular one today. Because of Bitcoin’s success, many other digital coins (called cryptocurrencies) have been created since then.

Bitcoin was created in 2008, and most people believe it was made by a person (or group) called Satoshi Nakamoto.

Bitcoin uses a public blockchain, which is like an online record that keeps track of all Bitcoin transactions.

Bitcoin mining is when powerful computers compete to solve a difficult math puzzle. The computer that solves it first adds a new block of transactions to the blockchain and earns new bitcoins as a reward.

People use Bitcoin in different ways — some buy it as an investment, hoping the price will go up, while others use it to buy things online. You can buy Bitcoin from popular crypto exchanges (websites where you can trade digital money).

However, Bitcoin is risky. Its price can change very quickly, and there are dangers like fraud and theft. So, it’s important to be careful when investing or using it.

What is Bitcoin and how does it work?

Bitcoin is a kind of digital money (also called a cryptocurrency). It only exists online — there are no paper bills or coins like regular money. Unlike the U.S. dollar or the euro, Bitcoin is not controlled by any government or bank.

All Bitcoin transactions are recorded on a public list called the blockchain. The blockchain is like a shared digital notebook that keeps track of who owns what. This notebook is stored on many computers around the world, not in one single place — this is called being decentralized.

Because Bitcoin is decentralized, people can send money directly to each other without using a bank. This system helps make transactions more secure and harder to manipulate or cheat.

Bitcoin Terms

Block:
A block is like a page in a digital record book. It stores information about Bitcoin transactions that have been checked and confirmed. Each new block connects to the previous one, making it hard to change or cheat the system.

Node:
A node is a computer that keeps a copy of the Bitcoin record (called the blockchain). It watches all Bitcoin activity and helps make sure everything follows the rules. There are more than 18,000 nodes around the world.

Bitcoin Address:
This is like your bank account number for Bitcoin. It’s a special code people use to send or receive Bitcoin.

Cryptography:
This is a type of advanced math that keeps Bitcoin transactions safe and private. It makes sure only the real owner can use their Bitcoin.

Bitcoin Mining:
Mining means using computers to check transactions and add new blocks to the blockchain. People who do this are called miners, and they earn Bitcoin as a reward.

Bitcoin Exchange:
A Bitcoin exchange is a website or app where you can buy or sell Bitcoin, or change it into regular money like dollars or rupees.

Bitcoin Wallet:
A wallet stores the secret keys that let you access your Bitcoin. It doesn’t hold the actual coins (they stay on the blockchain), but it’s your key to buy, sell, and use Bitcoin safely.

How to Buy Bitcoin

1. Choose a Bitcoin Exchange
Go to a trusted website or app where you can buy Bitcoin.
Examples: Coinbase, Binance, WazirX, CoinDCX, or Kraken.
These platforms let you buy Bitcoin using your local currency (like INR, USD, etc.).

2. Create an Account
Sign up with your email ID or phone number.
You’ll need to verify your identity by uploading a photo ID (like an Aadhaar card, PAN card, or passport).

3. Add Money to Your Account
Transfer money from your bank account, UPI, or debit card to your exchange wallet.
This is the money you’ll use to buy Bitcoin.

4. Buy Bitcoin
Search for “Bitcoin (BTC)” on the app or website.
Enter how much money you want to spend, and click “Buy.”
You can buy even a small part of one Bitcoin — you don’t need to buy a full one.

5. Store Your Bitcoin Safely
After buying, you can:

• Keep it on the exchange (easy but less secure), or
• Move it to a Bitcoin wallet (more secure).
  A wallet can be a mobile app or a special device that keeps your Bitcoin safe from hackers.

6. Track Your Investment
Watch Bitcoin’s price and your balance from time to time.
Prices can go up and down quickly, so be careful before buying or selling.

How to Use Bitcoin

1. Get a Bitcoin Wallet
First, you need a Bitcoin wallet — this is where you store and manage your Bitcoin.
It can be a mobile app, desktop software, or hardware wallet (a small USB-like device).
Your wallet gives you two things:

• A public address (like your account number) to receive Bitcoin.
• A private key (like your password) to send Bitcoin — never share this with anyone!

2. Receive Bitcoin
If someone wants to send you Bitcoin:

• Give them your Bitcoin address.
• Once they send it, the Bitcoin will show up in your wallet after the network confirms the transaction.

3. Send Bitcoin
If you want to send Bitcoin to someone:

• Open your wallet and click “Send.”
• Enter the receiver’s Bitcoin address and the amount.
• Check everything carefully and confirm.
  The transaction will go through in a few minutes.

4. Buy Goods and Services
Many online and some physical stores now accept Bitcoin as payment.
You can:

• Pay for online services, games, or travel bookings using Bitcoin.
• Scan a QR code at a store that accepts Bitcoin.

5. Trade or Invest
You can also use Bitcoin as an investment.
Keep it for the long term and sell when the price goes up — but remember, the price can also fall.

6. Convert Bitcoin to Regular Money
If you want cash, go to a Bitcoin exchange app (like WazirX, Binance, or CoinDCX) and sell your Bitcoin.
You’ll get the money directly in your bank account.

What Is Bitcoin Mining?

Bitcoin mining is the process of creating new Bitcoins and verifying Bitcoin transactions.

You can think of it like this 👇

• When people send Bitcoin to each other, the transaction must be checked to make sure it’s real.
• Special computers called miners do this checking.
• These miners solve difficult math problems using powerful computers.
• When they solve one, they confirm a block of transactions and add it to the Bitcoin blockchain (the public record of all Bitcoin transactions).