Please Note:

The below questions are answered in an oversimplified manner, to learn more about Bitcoin, there are numerous articles and videos covering these basics in more detail.

What is Bitcoin?

Bitcoin is a decentralized digital currency. Decentralized in that there is no central bank or administrator, instead it is stored in a public ledger maintained by its users.

What are all of these weird units?

Because bitcoins divide into very small parts, the smallest of which is the satoshi, there are unit prefixes to allow the easier writing of partial (or many) bitcoins.

Unit Name BTC Satoshi Notes
MBTC Mega-Bitcoin 1,000,000 100,000,000,000,000 Rarely used, but may show for massive jackpots.
kBTC Kilo-Bitcoin 1,000 100,000,000,000 Rarely used, but may show for massive jackpots.
BTC Bitcoin 1 100,000,000 base unit
mBTC Milli-Bitcoin 0.001 100,000
╬╝BTC Micro-Bitcoin, bit 0.000001 100  
sat. Satoshi 0.00000001 1 Smallest standard division of Bitcoin
Where do bitcoins come from?

Bitcoin is a crypto-currency, meaning that the basis and backbone of the currency is in cryptography.

For now, new bitcoins are created with each block solved by bitcoin "miners". These blocks are submitted to the network for verification and acceptance.

Since each block knows of the block before it, they can be linked to form a chain of every accepted transaction to the origin of bitcoin. This is the public ledger known as the blockchain.

In the case that multiple blocks are submitted for the same "height" in the blockchain, the block with more work is accepted.

What is a block?

A block consists of the hash of the previous block, some additional data, and a list of transactions to be added to the blockchain. Miners bundle all this data together and by only changing one piece of data, try to get a cryptographic hash that meets certain criteria. Once found, this block is then submitted to the network for verification and acceptance.

Blocks are accepted into the chain by being used as the basis for additional blocks, securing their spot in the chain that makes up the public ledger.

Every block on top of a given block is considered one "confirmation" of that block.