Bitcoin is a peer-to-peer payment system and digital currency introduced as open source software in 2009 by pseudonymous developer Satoshi Nakamoto. It is a cryptocurrency, so-called because it uses cryptography to control the creation and transfer of money. Users send payments by broadcasting digitally signed messages to the network. Participants known as miners verify and timestamp transactions into a shared publicdatabase called the block chain, for which they are rewarded with transaction fees and newly minted bitcoins. Bitcoins can be obtained by mining or in exchange for products, services, or other currencies.
Commercial use of Bitcoin is currently small but growing. Bitcoin as a form of payment for products and services has seen growth, however, and merchants have an incentive to accept the currency because transaction fees are lower than the 2–3% typically imposed by credit card processors.