Bitcoin is a digital currency that operates on a decentralized network, ensuring it is not controlled by any single entity or government. Unlike traditional currencies, Bitcoin is not backed by physical assets or government promises; instead, it is backed by the computational energy expended during its creation and maintenance. This energy-intensive process, known as mining, involves solving complex cryptographic puzzles, which both secures the network and verifies transactions.

Because Bitcoin relies on a distributed ledger called the blockchain, transactions are validated by a network of nodes rather than a central authority. This means that trust is established through cryptographic proof rather than relying on a trusted third party, making Bitcoin a unique and revolutionary financial system.