Bitcoin 101: The First Decentralised Digital Currency | Plus500 Academy

Bitcoin 101: The First Decentralised Digital Currency

Launched in 2009, Bitcoin is a cryptocurrency that operates on a peer-to-peer (P2P2) network, allowing users to transfer value without the need for banks or central authorities. Unlike traditional currencies, Bitcoin has no physical form, it's purely digital and secured by cryptographic technology.

How Bitcoin Is Created?

New bitcoins are generated through a process called mining, where network participants—known as miners—validate groups of transactions. Miners receive newly minted bitcoin along with transaction fees for their efforts. All activity is recorded on the blockchain, a public digital ledger that ensures transparency and security across the network.

Bitcoin’s Limited Supply

Bitcoin is designed to be scarce. Only 21 million coins will ever exist, with over 19.5 million already mined as of 2025. This capped supply makes Bitcoin unique among digital assets and contributes to its appeal as a store of value.

How to Get and Store Bitcoin

You can obtain Bitcoin in several ways: buying it on an exchange, receiving it from someone else, or earning it through mining. Before acquiring Bitcoin, you’ll need a digital wallet—software that stores your private key, which is used to authorize transactions and manage your holdings securely.

How Bitcoin Is Used

Bitcoin is increasingly accepted as a payment method for goods and services and can also be used for international money transfers. Some see it as an investment or hedge against inflation, while others trade it on exchanges to potentially capitalize on price movements. Its high liquidity and expanding global adoption continue to fuel its role in modern finance, even as it remains susceptible to sharp market reversals.

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