Bitcoin is the first and still the largest cryptocurrency: digital money that works without a bank or central authority. Here, you’ll learn how the technology works, where its value comes from, how safe your coins are, and how to buy, sell and use Bitcoin. For detailed definitions, see our Bitcoin glossary.
What is Bitcoin?
Bitcoin (ticker: BTC) is a digital currency run collectively by an open network of thousands of computers. Instead of bank accounts, it uses a public ledger called the blockchain. Every transfer is recorded there permanently, and anyone can check the records.
Bitcoin was invented by a person or group using the pseudonym Satoshi Nakamoto. The white paper, “Bitcoin: A Peer-to-Peer Electronic Cash System,” was published on October 31, 2008. The first block, known as the genesis block, was created on January 3, 2009. The network has been running around the clock ever since.
Three features set Bitcoin apart from euros or dollars:
- Fixed supply cap: There will never be more than 21 million BTC. No central bank can issue additional coins.
- No central authority: Open-source software enforces the rules, and participants choose to run it. No one can freeze accounts or reverse payments.
- Public but pseudonymous: All transactions are visible. Instead of names, they show addresses - long strings of characters that are not directly linked to a person.
How Bitcoin works
Every Bitcoin payment follows the same process:
- Signing: Your wallet signs the transaction with your private key. Only someone with that key can spend the coins.
- Broadcasting: The transaction is sent to the network’s nodes. They check the signature and verify that the coins have not already been spent.
- Bundling: Miners collect valid transactions from a waiting area called the mempool and put them into a new block.
- Adding the block: The first miner to solve the required computational puzzle gets to add the block to the chain. On average, this happens every ten minutes.
- Confirming: Each subsequent block counts as another confirmation. After six confirmations, or about an hour, a payment is considered practically irreversible.
Each block contains the hash of the previous block. To change an old entry, someone would have to recalculate every subsequent block faster than the rest of the network. This is what makes the blockchain resistant to tampering.
Where does Bitcoin’s value come from?
Bitcoin is backed by neither gold nor a government. Like any market-traded asset, its value comes from supply and demand.
Supply is strictly limited and predictable. New coins are created only as rewards for new blocks. Every 210,000 blocks, or roughly every four years, that reward is cut in half - an event called the halving. In 2009, the reward was 50 BTC per block. Since April 2024, it has been 3.125 BTC.
Demand comes from people and businesses that hold Bitcoin as a store of value, use it for payments or speculate on rising prices. Approved spot Bitcoin ETFs have been available in the US since January 2024, giving funds and institutional investors another way to invest.
Critics counter that Bitcoin generates no interest or profits, so its price depends entirely on market participants’ confidence. Bitcoin’s history includes several price drops of more than 70%, showing how sharply that confidence can shift.
How is Bitcoin’s price determined?
There is no single official Bitcoin price. Each exchange has its own order book, where buyers and sellers list their prices. As a result, prices vary slightly between exchanges.
Reference prices combine this data. The CoinDesk Bitcoin Price Index (XBX), for example, calculates an average price across several exchanges, weighted by their liquidity. These indexes also serve as benchmarks for financial products.
Here’s what matters for you:
- Around-the-clock trading: Bitcoin trades at night and on weekends, too. Large price movements can happen at any time.
- Euros or dollars: Most charts show the price in US dollars. If you buy in euros, what matters is your exchange’s euro price, including fees and the spread.
- Price risk when gambling: If you deposit Bitcoin at a casino, its euro value can change significantly before you withdraw. To avoid that exposure, you can use stablecoins.
How secure is Bitcoin?
Security has two separate aspects: the network itself and how you store your coins.
The network is considered highly robust. Its cryptography - the SHA-256 hash function and elliptic-curve digital signatures - has not been broken. To manipulate the blockchain, an attacker would need more than half of the world’s Bitcoin mining computing power. This so-called 51% attack would be extremely expensive against Bitcoin.
How you store your coins is the main weak point. Almost all losses happen here:
- Lost or stolen keys and recovery words.
- Phishing sites and fake wallet apps.
- Exchange failures or hacks - the best-known example is the collapse of Mt. Gox in 2014.
- Transfers to the wrong address or over the wrong network that cannot be recovered.
To protect yourself, keep larger amounts in your own wallet, write down your seed phrase offline, enable two-factor authentication and send a small test amount first when using a new address. Our guide to spotting scams explains how to recognize fraudulent offers.
Where can I get Bitcoin?
There are five common ways to get Bitcoin:
| Method | Advantage | What to check |
|---|---|---|
| Crypto exchange or broker | Easy purchases by SEPA transfer or card | Fees, spread, identity verification, whether external withdrawals are available |
| Bitcoin ATM | Converts cash directly into BTC | High markups, purchase limits |
| Peer-to-peer | Direct trading between individuals | Fraud risk; only trade with escrow protection |
| Payment for services | No purchase fees | Record the exchange rate at the time of payment |
| Mining | New coins directly from the network | Usually not profitable for individuals |
For most beginners, a regulated exchange with SEPA transfers is the cheapest option. Our buying Bitcoin guide explains how to compare providers, calculate costs and transfer Bitcoin safely.
Selling and exchanging Bitcoin
If you want to convert Bitcoin back into euros, the usual route is through an exchange. Send the coins to your deposit address, sell them there and withdraw the euros to your bank account via SEPA. Alternatively, you can exchange Bitcoin directly for another cryptocurrency, such as USDT or Ethereum, through an exchange or swap service.
Before selling, check:
- Fees: Trading fees, spreads and withdrawal fees are often charged separately.
- Limits and checks: Exchanges generally require identity verification for withdrawals. Banks may ask about the source of larger amounts, so keep your purchase receipts and transaction IDs.
- Taxes: Profits from selling may be taxable. The rules depend on where you are a tax resident.
Where can I pay with Bitcoin?
You can pay directly with Bitcoin mainly online. Merchants integrate payment services such as BitPay or run their own solutions, such as the free BTCPay Server. There are also gift card platforms where you can use Bitcoin to buy gift cards for major retailers, as well as crypto debit cards that automatically convert your coins into euros when you pay.
The Lightning Network works well for small amounts: payments arrive in seconds and usually cost fractions of a cent. Crypto casinos and sportsbooks are among Bitcoin’s biggest use cases, and BTC is almost always a standard payment option there.
Accepting Bitcoin as a merchant
Shops and service providers have two options:
- Payment processor: The service creates a payment address for each order and can immediately convert the amount into euros. This removes your exchange-rate risk, but you pay a fee.
- Your own setup: Software such as BTCPay Server lets you receive Bitcoin directly into your wallet without an intermediary. This saves fees, but you manage the keys and exchange-rate risk yourself.
In either case, record the euro exchange rate at the time of each payment for accounting and tax purposes.
What is Bitcoin used for?
- Store of value: Many people hold Bitcoin long term as “digital gold” because of its fixed supply cap.
- International transfers: You can send Bitcoin to any country without a bank, including on weekends.
- Protection against inflation: In countries with weak local currencies, people use Bitcoin to protect their savings.
- Online payments: At shops, for services and for gift cards.
- Gambling and sports betting: Crypto casinos accept Bitcoin for fast deposits and withdrawals. Learn more in our Bitcoin casino comparison.
- Speculation: A large share of trading simply bets on prices rising or falling.
Can you make money with Bitcoin?
Yes, but each approach carries its own risks:
- Price gains: If the price rises, you can make a profit when you sell. If it falls, you lose money. Only invest money you can afford to lose.
- Mining: Anyone can mine new coins, but specialized hardware and high electricity prices make it rarely profitable for individuals.
- Interest and lending: Platforms promise interest on deposited Bitcoin. If a platform fails, as crypto lender Celsius did in 2022, the coins are often lost.
- Getting paid in Bitcoin: If you sell goods or services for BTC, you earn Bitcoin directly.
Gambling does not belong on this list. Every casino game has a built-in house edge, so the operator wins over time. Only play with a fixed budget. For tips, see our responsible gambling guide.
Bitcoin mining explained
Mining is the process that creates new blocks and secures the network. Miners calculate SHA-256 hashes at high speed until they find one below a specified target. The first to do so gets to add the block and receives the block reward plus the transaction fees for all payments included in it.
To keep blocks arriving every ten minutes on average, the network adjusts the difficulty every 2,016 blocks, or roughly every two weeks. Today, mining is done almost entirely with ASICs - chips built specifically for this task. Individual miners join pools and share rewards according to their computing power. The network uses a lot of electricity, so large mining farms tend to operate where power is cheap.
Bitcoin wallets: Where you store your coins
Your Bitcoin is not stored in your wallet, but on the blockchain. The wallet manages the keys you use to access it. There are three basic types:
- Hot wallet: An app on your smartphone or computer, convenient for regular payments.
- Cold wallet: A hardware device that stores keys offline - the safest option for larger amounts.
- Custodial wallet: An exchange holds the keys for you. Convenient, but you depend on the provider.
When you set up your own wallet, you receive a seed phrase of 12 or 24 words. It lets you recover all your coins if you lose the device. Our crypto wallets for casinos guide explains which wallets suit casino payments. For the difference between holding your own keys and letting a provider hold them, see custodial vs. non-custodial.
Bitcoin at crypto casinos
Bitcoin was the first cryptocurrency accepted by online casinos and remains the most widely used there. These guides explain how deposits work, what to check when choosing a network and reviewing fees, and what to do if a payment gets stuck:
- Compare Bitcoin casinos
- Gambling with crypto: A step-by-step guide
- Check an on-chain transaction
- Stuck transaction: What to do
Frequently asked questions about Bitcoin
Who invented Bitcoin?
Bitcoin was developed by a person or group using the pseudonym Satoshi Nakamoto. The white paper was published on October 31, 2008, and the first block was created on January 3, 2009. The identity behind the name remains unproven.
How many bitcoins are there?
The maximum supply is 21 million BTC. New coins are created only as rewards for new blocks, and that reward halves every 210,000 blocks. Since April 2024, it has been 3.125 BTC per block. The final fractions are expected to be mined around 2140.
Is Bitcoin anonymous?
No. Bitcoin is pseudonymous. The blockchain does not contain names, but every transaction is public and permanently visible. Once an address is linked to your identity - for example, through an exchange that verifies your identity - your payments can be traced.
Do I have to buy a whole bitcoin?
No. One bitcoin can be divided into 100 million satoshis. Most exchanges let you buy a fraction for just a few euros, such as 0.0005 BTC.
Frequently asked questions
Who invented Bitcoin?
Bitcoin was developed by a person or group using the pseudonym Satoshi Nakamoto. The white paper was published on October 31, 2008, and the first block was created on January 3, 2009. The identity behind the name remains unproven.
How many bitcoins are there?
The maximum supply is 21 million BTC. New coins are created only as rewards for new blocks, and that reward halves every 210,000 blocks. Since April 2024, it has been 3.125 BTC per block. The final fractions are expected to be mined around 2140.
Is Bitcoin anonymous?
No. Bitcoin is pseudonymous. The blockchain does not contain names, but every transaction is public and permanently visible. Once an address is linked to your identity - for example, through an exchange that verifies your identity - your payments can be traced.
Do I have to buy a whole bitcoin?
No. One bitcoin can be divided into 100 million satoshis. Most exchanges let you buy a fraction for just a few euros, such as 0.0005 BTC.
