What is Bitcoin?

Bitcoin is a groundbreaking digital currency that has revolutionized the world of finance and investment. Created in 2009 by an anonymous entity known as Satoshi Nakamoto, Bitcoin is a decentralized form of money that operates on a peer-to-peer network. Unlike traditional currencies issued and regulated by governments and central banks, Bitcoin is governed by a technology called blockchain, which ensures transparency, security, and immutability of transactions.

At its core, Bitcoin is a decentralized ledger that records every transaction made with the cryptocurrency. It allows users to send and receive funds without the need for intermediaries, such as banks or payment processors. This open and permissionless system has given rise to a global network of users who can transact with each other without the traditional barriers and fees associated with cross-border payments. Bitcoin's scarcity is also a key feature, with a maximum supply of 21 million coins, making it a digital equivalent of precious metals like gold. As a result, Bitcoin has gained popularity as a store of value and a hedge against inflation.

Investors, technologists, and enthusiasts have embraced Bitcoin for its potential to disrupt the financial sector and its role as a digital asset with a limited supply. While its price can be highly volatile, Bitcoin has attracted interest as an investment, a means of transferring wealth across borders, and a tool for financial inclusion. As the cryptocurrency continues to evolve and mature, its impact on the global financial landscape is undeniable, and understanding what Bitcoin is and how it works is essential for anyone looking to navigate the modern digital economy.

A "satoshi" (often abbreviated as "sat") is the smallest unit of Bitcoin, representing a fraction of one Bitcoin. It is named after Bitcoin's mysterious creator, Satoshi Nakamoto. One Bitcoin is divisible into 100,000,000 satoshis. In other words, there are 100 million satoshis in a single Bitcoin.

Satoshi units are used to express smaller amounts of Bitcoin and make it more practical for everyday transactions. For example, if you wanted to purchase a cup of coffee with Bitcoin, you might be dealing with a price in satoshis rather than whole Bitcoins. This level of divisibility allows for microtransactions and ensures that Bitcoin can be used for a wide range of economic activities, from large investments to tiny everyday purchases.