What is Bitcoin? A Beginner's Guide

Learn the basics of Bitcoin and start your journey with confidence.

Bitcoin

Bitcoin is a digital currency that operates without banks or governments, using a public ledger called the blockchain.

A digital currency (also called a cryptocurrency) that allows people to send and receive money directly over the internet without intermediaries.

Operates on a technology called the blockchain, a public, tamper-proof ledger that records every Bitcoin transaction.

Decentralized - Unlike traditional currencies like the US dollar, Bitcoin is decentralized, meaning no single entity, such as a government or bank controls it.

You can use it to buy goods, send money to others, or hold it as an investment.

Why Does Bitcoin Matters?

Bitcoin matters because it showed the world that money can exist digitally, without needing banks or governments to control it.

No Middlemen: You don't need a bank to move money, which can help people in places with limited banking access.

Global Reach: It works anywhere with internet, making it easier to send money overseas without high fees.

New Possibilities: Bitcoin has sparked ideas like blockchain technology, which could change how we track goods, manager contacts, and more.

What Gives Bitcoin Value?

Its value comes from limited supply of 21 million coins, demand, and its use as a decentralized store of value or payment method.

Scarcity: Bitcoin's supply is capped at 21 million coins, with new coins released gradually through mining. This limited supply increases demand as more people adopt it.

Utility: Bitcoin can be used as a store of value (like gold) or a medium of exchange for goods and services. Its decentralized nature makes it appealing in regions with unstable currencies.

Demand: Growing interest from investors, businesses, and individuals drives price. Media coverage and institutional adoption, like Bitcoin ETFs, also boost demand.

Network Effect: The more people use Bitcoin, the more valuable it becomes, as its network grows stronger and more trusted.

Decentralization: Bitcoin's independence from central control appeals to those seeking financial sovereignty, especially in times of economic uncertainty.

Technological and Launch Milestones

10/31/2008

Bitcoin whitepaper released

"Bitcoin: Peer-to-Peer Electronic Cash System" posted.

01/03/2009

Bitcoin network launched

Genesis block mined, reward 50 BTC.

01/09/2009

First open source client released

Host at SourceForge.

01/12/2009

First Bitcoin transaction

Hal Finney received 10 BTC from Satoshi Nakamoto.

Adoption and Real-World Use Milestones

05/22/2010

First retail transaction

10,000 BTC for two pizzas, ~$40 USD at the time.

02/2015

Over 100,000 merchants accept Bitcoin

10/2020

Paypal allows Bitcoin trading

06/08/2021

El Salvador adopts Bitcoin as legal tender

Alongside the US Dollar.

Regulatory and Price Milestones

08/2013

Germany classifies Bitcoin as unit of account

Subject to capital gains tax if held <1 year.

09/2013

China bans financial institutions from BTC

Fearing money laundering risk.

12/04/2024

Bitcoin price hits $103,332.30 USD

Market cap ~1.9T, 55.2% of crypto market value on Nov 11, 2024.

05/22/2025

Bitcoin reaches all-time high

$111,970