OK, so what's Bitcoin?
It's not a real coin, it's "cryptocurrency," an electronic kind of payment which is produced ("mined") by many individuals worldwide. It helps peer-to-peer transactions instantly, worldwide, at no cost or at really low cost.
This currency just isn't supported by a tangible commodity (for example gold or silver); bitcoins are traded online making them a commodity in themselves.
Bitcoin is surely an open-source product, accessible by anyone who is a user. You just need an email address, Internet access, and cash to get going.
Where will it come from?
Bitcoin is mined over a distributed computer network of users running specialized software; the network solves certain mathematical proofs, and searches for a particular data sequence ("block") which causes a certain pattern once the BTC algorithm is used to it. A match produces a bitcoin. It's complex and time- and energy-consuming.
Only 21 million bitcoins are ever being mined (about 11 million are currently in circulation). The mathematics problems the network computers solve get progressively more challenging to maintain the mining operations and offer in check.
This network also validates all the transactions through cryptography.
So how exactly does Bitcoin work?
Internet surfers transfer digital assets (bits) to one another on a network. There isn't any online bank; rather, Bitcoin has been referred to as an Internet-wide distributed ledger. Users buy Bitcoin with cash or by selling services or products for Bitcoin. Bitcoin wallets store and use this digital currency. Users may sell out with this virtual ledger by trading their Bitcoin to a person else who wants in. Everyone can try this, all over the world.
There are smartphone apps for conducting mobile Bitcoin transactions and Bitcoin exchanges are populating the net.
Bed not the culprit Bitcoin valued?
Bitcoin is not held or controlled by way of a financial institution; it is completely decentralized. Unlike real-world money it can't be devalued by governments or banks.
Instead, Bitcoin's value lies simply in the acceptance between users being a form of payment and because its supply is finite. Its global currency values fluctuate based on demand and supply and market speculation; as increasing numbers of people create wallets and hold and spend bitcoins, plus more businesses accept it, Bitcoin's value will rise.