What Is Bitcoin?
Bitcoin is digital money that runs without a bank, a government or a company in charge. It was launched in January 2009 by an anonymous developer using the name Satoshi Nakamoto, and it remains the largest cryptocurrency by a wide margin. You can follow the live Bitcoin price at any time.
How Bitcoin actually works
Every Bitcoin transaction is recorded on a public ledger called the blockchain. Instead of one company keeping the records, thousands of computers around the world keep identical copies. When you send bitcoin, the network checks that you own it, groups your transaction with others into a block, and permanently links that block to the chain.
Nobody can quietly edit an old record, because changing one block would break every block that came after it. This is why people describe Bitcoin as trustless: you do not have to trust a middleman, you can verify the rules yourself.
Where does its value come from?
Bitcoin has no company behind it and pays no dividend, so its price comes down to supply and demand. Three things drive that:
- Fixed supply. There will only ever be 21 million bitcoin. No one can print more.
- Falling new supply. Roughly every four years the reward miners receive is cut in half. See our live Bitcoin halving countdown.
- Growing access. Spot ETFs, payment apps and institutional custody have made buying bitcoin far easier than it was a decade ago.
What is mining?
Miners run specialised computers that compete to solve a maths puzzle. The winner adds the next block and receives newly created bitcoin plus transaction fees. This process secures the network and releases new coins on a fixed schedule. It also consumes a lot of electricity, which is the main criticism levelled at Bitcoin.
How to buy your first bitcoin
- Pick a reputable exchange. Compare options on our top crypto exchanges page, which ranks them by trust score and volume.
- Verify your identity. Regulated exchanges require ID by law.
- Start small. You can buy a fraction of a bitcoin, often from as little as ten dollars.
- Move larger amounts to your own wallet. Read crypto wallets explained first.
Understand the risks
Bitcoin is volatile. Drops of 30 to 50 percent have happened many times, and each one felt permanent while it was happening. Never invest money you need in the next few years, and be extremely sceptical of anyone promising guaranteed returns. Our guide on avoiding crypto scams covers the most common traps.
Want to see how Bitcoin has performed historically? Use the BTC investment calculator or browse Bitcoin price history by date.
Frequently Asked Questions
Is Bitcoin legal?
In most countries yes, including the United States, the United Kingdom, the European Union, Turkey and Japan. A small number of countries restrict or ban it. Buying, holding and selling bitcoin is legal in the large majority of the world, though tax rules vary considerably.
Can I buy less than one bitcoin?
Yes. One bitcoin divides into 100 million units called satoshis, so you can buy a very small fraction. Most people who buy bitcoin own far less than a whole coin.
What happens when all 21 million bitcoin are mined?
The last bitcoin is expected around the year 2140. After that miners earn only transaction fees rather than new coins. The supply cap is enforced by the software rules that every node on the network runs.