tl;dr: Bitcoin is a decentralized cryptocurrency that came into existence in 2009. Transactions occur directly between users, facilitated by a peer-to-peer network and recorded on a decentralized ledger called a blockchain. Bitcoin has a limited supply of only 21 million units, and can be stored and sent through digital wallets. It is commonly used as a form of payment and a store of value, with many businesses and individuals accepting it as a legitimate currency.

What is Bitcoin?

Bitcoin came into existence in 2009 as a decentralized cryptocurrency, created by an anonymous person or group using the name Satoshi Nakamoto. Transactions take place directly between users without intermediaries like banks, facilitated by a peer-to-peer network.

Bitcoin uses a decentralized ledger called a blockchain to record transactions, ensuring their integrity and accuracy. The blockchain is maintained by a global network of computers and is secure because each transaction is verified and confirmed by multiple computers.

One of the unique features of Bitcoin is that it has a limited supply, with only 21 million Bitcoins to be mined. This distinguishes it from fiat currencies, which are characterized by rapid expansion of the money supply. Unlike fiat currencies, which can be printed by central banks, Bitcoin's supply cannot be increased beyond the predetermined limit, which makes it a scarce asset. While Bitcoin is not deflationary in the traditional sense, its scarcity can lead to deflationary pressures as demand for the limited supply of Bitcoin increases.

Bitcoin can be stored and sent through a digital wallet, and once a transaction is confirmed by the network, it is irreversible. Bitcoin has gained widespread adoption as a form of payment, with numerous businesses and individuals accepting it as a legitimate form of currency.

In addition to its use as a form of payment, Bitcoin is also commonly used as a store of value. Many investors and individuals view Bitcoin as a digital asset that can potentially increase in value over time, similar to traditional investments like stocks and bonds. Due to its limited supply and deflationary nature, some believe that Bitcoin can act as a hedge against inflation and an alternative to traditional forms of currency.