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This means that everyone who uses Bitcoin has a tiny fraction of the bank of Bitcoin. Bitcoins can be used as a cheaper and faster alternative to traditional electronic payment like paypal, credit cards, and online banking money transfers. The Bitcoins are stored in bitcoin wallets, which come in different types, e. It is an electronic payment system based on mathematical proof, which is done through Mining. Mining is a way to disseminate new coins in a decentralized manner as well as motivating people to provide security for the system by validating transactions in a trustful manner when enough computational power is devoted to a block.
Bitcoin mining is how Bitcoin transactions are validated and confirmed by the Bitcoin network. Bitcoin miners create a new block by solving a proof of work problem that is chained through cryptographic proof to the previous block.