Bitcoin
Bitcoin is a decentralised digital currency and blockchain network introduced in 2009. Its native asset is bitcoin, commonly represented by the ticker BTC. Bitcoin allows users to transfer value directly across its network without requiring a central bank or payment company to approve each transaction.
✦ Key Insight
Bitcoin was the first widely adopted cryptocurrency and remains a major reference point for the broader crypto market. It introduced important concepts including decentralised digital scarcity, proof-of-work mining, a public distributed ledger, and self-custody. For traders, Bitcoin often acts as a benchmark for market sentiment, liquidity, derivatives activity, and overall crypto market direction.
✕ Common Misconceptions
Confusing Bitcoin with every cryptocurrency
Sending BTC to an incompatible network
Assuming Bitcoin transactions are anonymous
Leaving large balances on an exchange without considering custody
Ignoring transaction fees
Treating short-term price movements as changes to Bitcoin's protocol
Detailed Explanation
How It Works
Bitcoin transactions are broadcast to a peer-to-peer network.
Miners compete using computing power to produce valid blocks. Nodes verify that transactions and blocks follow Bitcoin's rules.
New bitcoin enters circulation through block rewards, while transaction fees provide additional compensation to miners.
Bitcoin's issuance schedule is predefined by the protocol and includes periodic halving events.
FAQs
Who controls Bitcoin?
No single organisation controls the network. Its rules are maintained through software, miners, nodes, developers, and users.
Does Bitcoin have a maximum supply?
Its protocol is designed around a maximum issuance of 21 million BTC.
In Practice
Dig Deeper
Proof of Work
Proof of Work is a blockchain consensus system where miners use computing power to secure the network.
Cryptocurrency
A cryptocurrency is a digital asset that uses cryptography and blockchain or distributed-ledger technology to record ownership and transfers. Cryptocurrencies can be used for payments, investment, trading, network fees, governance, staking, or access to blockchain applications.
Mining
Mining is the process used by proof-of-work blockchains in which specialised computers perform computational work to compete for the right to add new blocks. Bitcoin is the most prominent example.