Bitcoin is not the shiny gold physical coin often seen in the media – it is actually completely virtual.

It is a cryptocurrency – each coin is a computer file that can be used to buy goods and services. It is stored in a digital wallet app and is secured by cryptography.

Participants in the bitcoin market can buy or sell tokens by making transactions from their digital wallets, or through cryptocurrency exchanges. But it’s acceptance is still not widescale.

Every bitcoin transaction that’s ever been made exists on a public ledger, called a blockchain making transactions hard to reverse and difficult to fake.

This is important because bitcoins are not backed by the government or any institution, and there’s nothing to guarantee their value other than this proof.

As the world evolves, cryptocurrencies are getting mainstream acceptance.

For instance, PayPal now allows customers to buy and sell bitcoin. And many investors are adding it to their portfolios.

Based on market capitalization, bitcoin is the number one cryptocurrency in the world.