What Is Bitcoin? How It Works, Who Controls It and Why the…

Key facts

• Launched in January 2009 by the pseudonymous Satoshi Nakamoto, following a nine-page white paper published on 31 October 2008. Nakamoto's real identity has never been confirmed.
• Supply is capped at 21 million coins. About 20.09 million, or 95.6 percent, have already been created (blockchain.com, 17 September 2026).
• A new block is added about every 10 minutes. Each block currently pays its miner 3.125 new bitcoin, a reward set by the April 2024 halving.
• The next halving is expected around April 2028 at block 1,050,000, when the reward drops to 1.5625 BTC (CoinWarz estimate).
• The network is secured by roughly 800 exahashes per second of mining computation (blockchain.com estimate, 17 September).
• The price is volatile. Bitcoin set a record above $126,000 in early October 2025. At around $76,500, it trades roughly 39 percent below that peak.

What is Bitcoin, in plain terms?

Bitcoin is two things with the same name. Bitcoin, with a capital B, is the network: open-source software that lets people send value to each other over the internet without a bank in the middle. bitcoin, or BTC, is the unit of money that moves on that network. One bitcoin divides into 100 million smaller units called satoshis, so you do not need to buy a whole coin.

Take a normal bank transfer. Your bank and the recipient's bank each keep a private record of who owns what, and they settle between themselves. Bitcoin replaces those private records with one shared record called the blockchain. Every transaction since January 2009 is written into it, and anyone can download a copy and check it.

How Bitcoin works

1. Wallets, keys and signatures

You do not hold bitcoin in an account. You hold a private key, a very large secret number, and a public address derived from it. To spend coins, your wallet uses the private key to sign a transaction, which proves you control those coins without revealing the key. That signature scheme is called ECDSA; we explain it step by step in what ECDSA is and how Bitcoin's digital signatures work. The practical consequence matters more than the maths: whoever has the private key controls the coins. Lose the key and the coins are gone. There is no password reset.

2. The network checks every transaction

A signed transaction goes out to the network's nodes, the computers running Bitcoin software. Each node checks the same things independently. Is the signature valid? Do these coins exist? Have they already been spent? Invalid transactions are rejected. No single node has the final say.

3. Miners bundle transactions into blocks

Valid transactions wait in a queue until a miner includes them in a block. To add a block, a miner has to find a number that makes the block's cryptographic fingerprint fall below a target. The only way to find it is brute-force guessing, and that guessing is what "mining" means. The first miner to find the number broadcasts the block and collects the block reward plus the fees users paid. We cover the economics in detail in what cryptocurrency mining is and how bitcoin miners earn.

4. Difficulty keeps the clock at 10 minutes

Every 2,016 blocks, roughly two weeks, the network adjusts how hard the puzzle is. If more machines join and blocks come faster, the difficulty rises. If miners leave, it falls. That automatic adjustment is why new bitcoin appears on a predictable schedule, no matter how much computing power is pointed at the network.

5. Why it is hard to cheat

Each block contains the fingerprint of the block before it, so the blocks form a chain. Rewriting an old transaction would mean redoing the mining work for that block and every block after it, faster than the rest of the network adds new ones. With roughly 800 exahashes per second securing the chain today, that would require an enormous share of the world's specialised mining hardware and electricity.

Who controls Bitcoin?

Nobody, in the sense that a company controls its product. Control is split between groups that check each other:

• Node operators decide which rules they enforce. A block that breaks the rules gets rejected, however much computing power produced it.
• Miners decide which valid transactions go into blocks and in what order. They cannot create extra coins or spend other people's bitcoin.
• Developers maintain the open-source software and propose changes through a public process known as Bitcoin Improvement Proposals. A change only takes effect if node operators choose to run it.
• Holders and exchanges give the coin its value by deciding which version of the network they treat as "bitcoin".

What governments do control is the on-ramps. They regulate the exchanges, brokers and funds where most people buy bitcoin. That is why regulation still moves the price even though no regulator can change the protocol. This week showed it: the US Senate's failure to advance the CLARITY Act on 15 September hit bitcoin and XRP.

Why the Bitcoin price moves

Bitcoin has no earnings, dividends or central bank behind it. Its price is set by supply and demand alone, and both sides behave in specific ways:

• Fixed, falling issuance. Supply cannot respond to demand. New coins are created at 3.125 BTC per block, about 450 a day, and that rate halves again around 2028. When demand rises, only the price can adjust.
• Interest rates and the dollar. Bitcoin now trades as a risk asset. When the Federal Reserve raised rates 25 basis points to 3.75-4.00 percent on 16 September, bitcoin stayed pinned near $75,000-$76,000 (our report).
• ETF flows. Since US spot bitcoin ETFs launched in January 2024, their daily flows have become a visible gauge of institutional demand. On 15 September alone, they recorded $450.4 million of net withdrawals, led by Fidelity's FBTC and BlackRock's IBIT (fund flow data).
• Regulation. Rules for exchanges, stablecoins and custody decide how easily large pools of capital can buy.
• Leverage. A large share of bitcoin trading happens in derivatives. Forced liquidations can amplify a small move into a much larger one within hours.

What makes Bitcoin different from other cryptocurrencies

The risks worth knowing before you buy

• Volatility. A drop of around 39 percent from the October 2025 record is ordinary for bitcoin, not an exception.
• Self-custody risk. A lost or stolen private key cannot be recovered.
• Counterparty risk. Coins held on an exchange are only as safe as that exchange.
• Scams. Fake investment platforms and "recovery" services target new buyers. No legitimate service guarantees returns.
• Regulatory change. Tax treatment and access rules differ by country and keep changing.

FAQ

What is Bitcoin in simple words?
Bitcoin is internet money that no bank or government issues. Its transactions are recorded on a public ledger, the blockchain, which thousands of independent computers keep identical.

Who created Bitcoin?
A person or group using the name Satoshi Nakamoto. Nakamoto published the Bitcoin white paper on 31 October 2008 and launched the network in January 2009. Their real identity has never been confirmed.

How many bitcoins are left to mine?
As of block 967,373 on 17 September 2026, 20,085,534 bitcoin exist (blockchain.com). That leaves about 914,000 still to be created. Because the block reward halves every 210,000 blocks, the last fractions will not be mined until around the year 2140.

What is the Bitcoin price today?
About $76,500 per coin on the morning of 17 September 2026 (CoinGecko), for a market value of roughly $1.54 trillion. The price changes around the clock.

Is Bitcoin legal?
Owning bitcoin is legal in most major economies, including the United States, the United Kingdom and the European Union. Rules on exchanges, taxes and advertising vary by country, and a few jurisdictions restrict it.

Can Bitcoin be hacked?
The protocol itself has never been successfully rewritten. The weak points are around it: exchanges, wallet software and users' own private keys. Most "Bitcoin hacks" in the news are thefts from those.

What is the difference between Bitcoin and crypto?
Crypto, or cryptocurrency, is the whole category of blockchain-based digital assets. Bitcoin was the first and remains the largest by market value. Thousands of other cryptocurrencies followed, many with different supply rules and uses.

Sources: blockchain.com (circulating supply, block height and network hashrate estimate, 17 September 2026); CoinGecko (BTC price and market capitalisation, 17 September 2026); CoinWarz (next halving estimate); Satoshi Nakamoto, "Bitcoin: A Peer-to-Peer Electronic Cash System" (2008); Reuters and fund flow data as cited in linked FinanceFeeds reports.

This article is for informational purposes only and does not constitute financial advice. Cryptocurrencies are highly volatile and carry substantial risk of loss. Prices quoted were accurate at the time of writing and move continuously. Always conduct your own research and consider consulting a licensed financial adviser before making investment decisions.