1) A Bitcoin is an electronic token that has a unique key. You can create them (aka mine them) by creating the key, but it takes a lot of computing power a bit like finding a big prime number.
2) There is a finite number of them so they can’t inflate, in theory.
3) They aren’t controlled by any government, and transactions are untraceable.
Now here’s what I don’t understand:
1) As computing power improves, won’t it be easier to find new ones?
2) If there’s a finite supply it must surely deflate. Which rewards people hoarding them, and enourages people not to spend them…?
3) The exchange rate seems far more volatile than most real currencies which kind of defeats the object of using it as a real currency. I don’t want my savings to be that volatile ta.
The cynic in me imagines that it’s a big fat scam that made a lot of money for the creators.