 TITLE: What Is Bitcoin and How Does It Work? CONTENT: Bitcoin is a decentralized and completely digital currency. Unlike fiat currencies, such as the U.S. dollar, euro or British pound, governments don't create or back Bitcoins.\nBitcoin and other cryptocurrencies—there are many—are powered by \"blockchain\" technology. The Bitcoin blockchain is a decentralized public ledger, which might sound like technobabble, but isn't difficult to understand as a concept.\nThe Bitcoin blockchain is a public ledger (or database) that's created and managed by a large network of computers rather than a single entity or central bank—that's what makes it decentralized.\nNew information, such as recent transactions, are grouped together to form a block. The block is then added (or chained) to the existing database. Once new information is added, it can't be edited or deleted, and anyone can review the Bitcoin blockchain database. The result is a permanent record of Bitcoin transactions that's available for public review.\nFor example, if you send Bitcoins to someone else, an uneditable record of the transaction is added to the ledger, which is synced on tens of thousands of computers around the world.\nBitcoin also allows for transactions that remain anonymous to a certain extent. While there's a public record of the transaction from person A to person B, there isn't any identifying information about who person A and B are. However, anonymity goes out the window if you publish your Bitcoin address (the address you use to receive the currency) publicly. With your Bitcoin address, someone can see your transactions and even view the balance associated with it.\nAll of this complex math requires a lot of computational power, which is where Bitcoin miners come in. Miners allow use of their computers to process transactions and, in return, they receive Bitcoins as payment. Anyone can set their computer up to mine Bitcoin, although the cost of electricity to power your computer may be more than you earn in the currency. END