What is Bitcoin (BTC) and How Does It Work?

Bitcoin (BTC) has become a household name over the past decade, yet many people still wonder: What is Bitcoin, and how does it work? Whether you’re completely new to cryptocurrency or simply looking to expand your knowledge, this guide explains everything you need to know about Bitcoin in straightforward terms. Plus, we’ll show you how you can get started safely with a CoinEx account using our referral code.

A Brief Introduction to Bitcoin (BTC)

Bitcoin is the very first cryptocurrency. Created in 2009 by an individual or group going by the pseudonym Satoshi Nakamoto, Bitcoin was designed as a digital currency free from government influence, intermediaries, or central banks. Instead, it relies on a decentralized technology called blockchain.

What Makes Bitcoin Different?

Unlike traditional currencies such as the US Dollar or Euro, Bitcoin is decentralized. There’s no central authority issuing or regulating it. Instead, computers around the world maintain the Bitcoin network by verifying transactions and securing the system. This peer-to-peer network allows anyone to send and receive Bitcoin without needing permission from a bank.

Supply is Limited: There will only ever be 21 million bitcoins in existence, which is coded into Bitcoin’s software. This limited supply is what makes Bitcoin valuable and resistant to inflation.
Open and Transparent: Every Bitcoin transaction is recorded on the blockchain—a public ledger anyone can inspect.

How Does Bitcoin Work?

The world of Bitcoin might seem complex, but at its core, it’s rather simple. Here’s what happens when you use Bitcoin:

Wallets: You store bitcoins in a digital wallet (software, hardware, even paper).
Transactions: When you send or receive Bitcoin, your wallet signs the transaction cryptographically, proving ownership without revealing your identity.
Mining: Computers called miners validate transactions on the blockchain. As a reward, they may earn new bitcoins.

The Blockchain Explained

What is a blockchain? In short, it’s a chain of digital blocks, each containing a record of several transactions. Each block is connected (chained) to the previous one, forming a permanent, unchangeable history of all transactions ever made.

Why Do People Buy Bitcoin?

Store of Value: Many people see Bitcoin as digital gold, storing wealth over time.
Investment: It’s considered an asset that can potentially appreciate, though it’s also very volatile.
Decentralization: Since it’s not controlled by any single entity, it appeals to those who value financial independence.
Borderless Payments: Bitcoin can be sent anywhere, anytime, without intermediaries.

How to Invest or Start Using Bitcoin

Ready to try Bitcoin yourself? The easiest way for newcomers is through a trusted crypto exchange. CoinEx is a global platform that lets you buy, sell, and manage Bitcoin securely.

If you use our referral code mhz7w during registration, you may be eligible for exclusive bonuses or discounts on CoinEx!

Getting Started in 3 Steps

Sign up: Create your CoinEx account (use code mhz7w).
Verify your identity: For security and to unlock all features.
Buy Bitcoin: Fund your account and purchase Bitcoin directly.

Frequently Asked Questions About Bitcoin

Is Bitcoin Safe?

If you follow best practices—like using reputable wallets and enabling two-factor authentication—Bitcoin is secure. Remember, never share your private keys!

Can I Lose My Bitcoin?

Since you control your own private keys, losing them can mean losing your Bitcoin. Always back up your wallet securely.

Can I Use Small Amounts?

Absolutely! Bitcoin is divisible down to 0.00000001 BTC (called a satoshi), so you don’t need to buy a whole coin.

Whether you’re considering investment, want to learn more, or are just seeking a secure and reputable way to buy Bitcoin, CoinEx is your starting point. Don’t forget to use the referral code mhz7w for any possible sign-up perks!

More Resources

Bitcoin is reshaping money for the internet age. Thanks to platforms like CoinEx, it’s easier than ever to learn, invest, and participate in the world of digital currency.