Bitcoin is a digital currency that runs on a public network of computers instead of a bank. Its supply is capped at 21 million coins, and every transaction is recorded on a public ledger called the blockchain. It was launched in 2009 by the pseudonymous Satoshi Nakamoto, and its price can rise or fall sharply.
Bitcoin was the first cryptocurrency. It lets people send value to each other over the internet without a bank or payment company in the middle. This guide explains what Bitcoin is, where it came from, how the network works and what to weigh before you own any. If digital money is new to you, you can also read what cryptocurrency is.
You can follow the live Bitcoin price as you read. The price alone, though, tells you little about how Bitcoin works or whether it suits you. Each section below starts with a short answer and links to a more detailed guide.
What is Bitcoin?
Bitcoin is a digital currency that runs on a public network of computers instead of a bank. Its rules are set by open-source software, and no single company or government runs it.
The word is used in two ways. “Bitcoin” with a capital B usually means the network and its rules. “bitcoin”, or BTC, means the currency unit that moves across it. A bitcoin has no physical form. It exists only as an entry on a shared record, as what bitcoins look like explains.
That shared record is the blockchain, a public ledger of every Bitcoin transaction. Computers around the world keep copies of it and check that each new transaction follows the rules. bitcoin.org puts it this way: nobody owns the Bitcoin network, much as no one owns the technology behind email (as of September 2026). Developers can propose changes to the software, but they cannot force anyone to run it.
Many other cryptocurrencies have followed Bitcoin. Bitcoin vs Ethereum explains how it differs from another major network.
How is Bitcoin different from regular money?
Bitcoin differs from money in a bank account in who runs it, how much of it can exist and what happens when something goes wrong. The table sums up the main differences.
| Feature | Bitcoin | Money in a bank account |
|---|---|---|
| Who runs it | No single company or government. Users choose which software to run. | A central bank issues the currency, and banks keep the accounts. |
| Supply | Capped at 21 million bitcoins by the software’s rules. | Set by central bank policy, with no fixed cap. |
| Reversing a payment | A confirmed payment cannot be reversed. Only the receiver can send it back. | Banks can sometimes stop, dispute or reverse a payment. |
| Privacy | Every transaction is public. Addresses do not show names. | Your bank keeps your records private, within the law. |
| Deposit protection | None. Bitcoin is not a bank deposit. | In many countries, deposits are insured up to a limit. |
| Smallest unit | One bitcoin divides into 100 million satoshis. | Usually one hundredth of the currency, such as a cent. |
Neither is simply better. Bitcoin gives you direct control over your money, but it also puts the whole job of keeping it safe on you. In the US, for example, the FDIC lists crypto assets among the products it does not insure (as of September 2026).
Who created Bitcoin?
Bitcoin was created by Satoshi Nakamoto, a pseudonym used by a person or group whose real identity is still unknown. Nakamoto published the plan for Bitcoin in 2008 and launched the network in January 2009.
On 31 October 2008, Nakamoto shared a paper called “Bitcoin: A Peer-to-Peer Electronic Cash System” on a cryptography mailing list. The paper described a way to send online payments directly from one person to another, without a financial institution in the middle. It also explained how a network could stop the same coins from being spent twice without a central party keeping the books.
The first block of the Bitcoin blockchain, known as the genesis block, is dated 3 January 2009. Its data includes a newspaper headline from that day: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks”. The headline shows the block was not made before that date, and it is often read as a comment on the bank bailouts of the time. A few days later, Nakamoto announced the first version of the Bitcoin software on the same mailing list.
Many people have been named as possible candidates, but no claim has been proven. Read five people who might be Satoshi Nakamoto for the main theories.
How does Bitcoin work?
Bitcoin works by keeping one shared record of which coins belong to which addresses. Computers on the network check every new payment against that record, and miners add valid payments to it in blocks. A payment goes through four stages:
- You create a payment. Your wallet signs it with your private key. The signature proves you control the coins without revealing the key itself. Public keys vs private keys explains how this works.
- The network checks it. Computers called nodes check that the signature is valid and that the coins have not already been spent. Valid payments wait in a queue called the mempool.
- A miner adds it to a block. Miners collect waiting payments into a block. New blocks are added about every 10 minutes on average (bitcoin.org, as of September 2026).
- The payment gains confirmations. Each block added after yours counts as one more confirmation. bitcoin.org explains that each confirmation makes a payment harder to reverse (as of September 2026).
The sender pays a network fee to the miners. The fee depends on the size of the transaction in bytes, not on the amount sent, and a payment that offers less than the network is currently prioritising can take much longer to confirm (bitcoin.org, as of September 2026). Once confirmed, a payment cannot be undone. See whether blockchain transactions can be reversed.
For a closer look at blocks, keys and nodes, read how Bitcoin works. For small everyday payments, some wallets also use the Lightning Network, a second layer built on top of Bitcoin.
What is Bitcoin mining?
Mining is the process that adds new blocks to the blockchain and releases new bitcoins. Miners use specialised computers to compete for the right to add the next block. The winner earns newly created bitcoins plus the fees from the payments in that block.
The competition is called proof of work. Miners repeat a calculation, called hashing, with different inputs until one of them finds a result that meets the network’s target. Finding that result takes a great deal of computing work, but anyone can check it quickly. This is what makes the record hard to change: rewriting an old block would mean redoing its work and the work of every block after it. The 2008 white paper explains that the system stays secure as long as honest miners control most of the computing power.
The network resets the target every 2,016 blocks, about every two weeks. This keeps new blocks arriving about every 10 minutes on average, however much computing power joins or leaves (Bitcoin Core source code, as of September 2026). See difficulty adjustment.
Mining uses a lot of electricity. The Cambridge Centre for Alternative Finance publishes a running estimate of the network’s power use, the Cambridge Bitcoin Electricity Consumption Index. Whether you may mine also depends on where you live: read is Bitcoin mining legal?
How many bitcoins are there?
As of September 2026, about 20.09 million bitcoins had been created, roughly 96% of the 21 million that can ever exist (Blockchain.com block explorer). The limit is written into Bitcoin’s software, and new coins are released on a fixed schedule.
That schedule is set by the halving. Every 210,000 blocks, about every four years, the number of new bitcoins paid for each block is cut in half (Bitcoin Core source code, as of September 2026). The most recent halving took place at block 840,000 on 20 April 2024, when the reward fell from 6.25 to 3.125 bitcoins per block.
| Event | Block | Date (UTC) | New bitcoins per block |
|---|---|---|---|
| Launch | 0 | 3 January 2009 | 50 |
| First halving | 210,000 | 28 November 2012 | 25 |
| Second halving | 420,000 | 9 July 2016 | 12.5 |
| Third halving | 630,000 | 11 May 2020 | 6.25 |
| Fourth halving | 840,000 | 20 April 2024 | 3.125 |
| Fifth halving | 1,050,000 | Expected in 2028 | 1.5625 |
At the target pace of one block every 10 minutes, the next halving falls in 2028, and the last fraction of a new bitcoin would be created around the year 2140. After that, the white paper describes miners being paid entirely through transaction fees. The halving changes how many new coins appear. It does not set the price. For dates and background, read the Bitcoin halving: dates and history.
Some coins will never move again. bitcoin.org notes that bitcoins whose keys are lost “remain dormant forever” (as of September 2026), so fewer than 21 million may ever be usable. Each bitcoin divides into 100 million units called satoshis. See what a satoshi is and Bitcoin units explained.
What gives Bitcoin value?
Bitcoin has value because people are willing to accept it and hold it. Nothing physical backs it, and no government or company stands behind it.
bitcoin.org says bitcoins have value because they are useful as a form of money, with properties such as scarcity, divisibility and portability (as of September 2026). Supporters point to the fixed supply and to a network that no single party controls. Critics point out that bitcoin pays no income and that its value rests entirely on demand. Read what backs cryptocurrency for both sides.
The price is set by supply and demand (bitcoin.org, as of September 2026). News, interest rates, changes in the rules and the mood of wider markets can all move it, sometimes sharply within a single day. See how Bitcoin’s price is determined.
Bitcoin’s price changes all the time. Latest reference price: 1 BTC =$80,066.78-1.42% (24h). Past performance does not predict future results.
Some people hold bitcoin for the long term, and others avoid it. Why people buy bitcoin sets out the common reasons and their trade-offs, and could bitcoin crash to zero? looks at the downside.
Is Bitcoin safe?
It depends on which risk you mean. The network itself has a strong security record, but people still lose bitcoin through mistakes, theft and scams, and the price can fall sharply.
- The network. bitcoin.org says the Bitcoin protocol and its cryptography have a strong security track record (as of September 2026). The main known weakness is an attack by someone who controls most of the mining power, which is why the network relies on honest miners holding the majority.
- Your own coins. bitcoin.org says the most common weakness is user error, such as losing a key (as of September 2026). Payments cannot be reversed, so a wrong address or a scam usually means the money is gone. Read how to protect yourself from fraud.
- The price. bitcoin.org calls bitcoin a high-risk asset and warns never to store money in it that you cannot afford to lose (as of September 2026). When the US Securities and Exchange Commission (SEC) approved spot bitcoin exchange-traded products in January 2024, it said it did not approve or endorse bitcoin and described it as primarily a speculative, volatile asset.
- Rules and taxes. Laws on crypto differ by country and change over time. Check the rules where you live before you buy.
Safety also depends on the services and wallets you use. For a fuller checklist, read is Bitcoin safe to buy?
What can you do with Bitcoin?
You can send it, spend it where it is accepted, or hold it. How useful each option is depends on where you live and who you deal with.
- Send money. You can send bitcoin to any wallet address in the world, on any day, without a bank in between. The person you pay may need to convert it into local currency, which can add costs.
- Pay for goods and services. Some shops and online services accept bitcoin. Acceptance varies a lot from place to place: see what Bitcoin adoption means.
- Hold it. Some people keep bitcoin as a long-term holding and accept that its value can fall sharply. Some spread their purchases over time, a method called dollar-cost averaging. It changes when you buy, but it does not remove the risk of loss.
- Get price exposure through a fund. Some people buy a fund that tracks the bitcoin price instead of holding coins. Bitcoin ETF vs owning bitcoin compares the two.
- Learn the technology. Owning a small amount is a hands-on way to see how wallets and transactions work.
Authorities do not all classify Bitcoin the same way: read is Bitcoin a commodity? Spending or selling bitcoin can also have tax consequences. bitcoin.org notes that most jurisdictions tax anything that has value, including bitcoins (as of September 2026).
How do you buy Bitcoin?
Most people buy bitcoin through an online service such as a cryptocurrency exchange, where you create an account, complete an identity check, choose an amount and enter a wallet address for the coins. You do not need to buy a whole coin, because you can buy a fraction of a bitcoin. How to buy Bitcoin walks through each step, and you can see the Bitcoin price and payment options on Coinmama.
How do you store Bitcoin?
You store bitcoin in a wallet. A wallet does not hold coins as such. It holds the private keys that let you spend the bitcoin recorded on the blockchain.
Wallets come in two broad types. Hot wallets, such as phone and desktop software, stay connected to the internet and are handy for everyday use. Cold wallets, such as hardware devices, keep the keys offline and are often used for larger amounts held for longer. Read what a crypto wallet is and hot wallets vs cold wallets to compare them.
You can also leave coins with a company that holds them for you, but then you depend on that company. When you hold your own keys, bitcoin.org notes, you control your bitcoin but you are also responsible for keeping it secure (as of September 2026). Most wallets give you a seed phrase to restore access. If you lose both the wallet and its seed phrase, the funds are gone for good.
Always check a wallet address before you send, because a payment to the wrong address cannot be recalled. To move coins between wallets, see how to send bitcoin to a wallet.
Which Bitcoin guides should you read next?
This guide is the starting point for the Bitcoin section of the Coinmama Academy. The guides below go deeper into each topic.
How Bitcoin works
- How does Bitcoin work? Blocks, mining, nodes and the halving in more detail.
- What do bitcoins look like? Why a bitcoin has no physical form.
- The Bitcoin halving: the dates and background of each halving.
- Who might be Satoshi Nakamoto? The main theories about Bitcoin’s creator.
Bitcoin units
- What is a satoshi? Bitcoin’s smallest unit.
- Bitcoin units explained: BTC, mBTC, bits and sats side by side.
- Can you buy a fraction of a bitcoin? How small purchases work.
Price, risk and privacy
- How is Bitcoin’s price determined? The forces that move the price.
- Will bitcoin crash to zero? The case for and against, and the risks.
- Is Bitcoin safe to buy? A checklist of the main risks.
- Can bitcoins be traced? How private Bitcoin really is.
Owning and using bitcoin
- Why buy bitcoin? Common reasons and their trade-offs.
- Bitcoin ETF vs owning bitcoin: how the two differ.
- Dollar-cost averaging into bitcoin: buying in smaller amounts over time.
- What is Bitcoin adoption? Where and how Bitcoin is used.
- Is Bitcoin a commodity? How authorities classify it.
Frequently asked questions
Sources
- Satoshi Nakamoto: Bitcoin: A Peer-to-Peer Electronic Cash System (white paper, 2008) (checked September 2026)
- The Cryptography Mailing List: “Bitcoin P2P e-cash paper”, 31 October 2008 (checked September 2026)
- The Cryptography Mailing List: “Bitcoin v0.1 released”, January 2009 (checked September 2026)
- mempool.space block explorer: block 0 (genesis block), 3 January 2009 (checked September 2026)
- mempool.space block explorer: block 840,000 (fourth halving), 20 April 2024; earlier halving blocks 210,000, 420,000 and 630,000 on the same explorer (checked September 2026)
- Blockchain.com Explorer: Total Circulating Bitcoin (checked September 2026)
- Bitcoin Core source code: chainparams.cpp (halving every 210,000 blocks, 10-minute block target, two-week difficulty period) (checked September 2026)
- Bitcoin Core source code: amount.h (21 million limit) (checked September 2026)
- bitcoin.org: Frequently asked questions (checked September 2026)
- bitcoin.org: Some things you need to know (checked September 2026)
- US Securities and Exchange Commission: Statement on the Approval of Spot Bitcoin Exchange-Traded Products, 10 January 2024 (checked September 2026)
- Cambridge Centre for Alternative Finance: Cambridge Bitcoin Electricity Consumption Index (checked September 2026)
- FDIC: Financial Products That Are Not Insured by the FDIC (checked September 2026)
