EXPLAIN: HOW BITCOIN WORKS?
Bitcoin’s value, like all currencies, is determined by how much people are willing to exchange it.
To process Bitcoin transactions, a process called “mining” must take place, which involves a computer solving a difficult problem with a 64-digit solution.
For each problem solved, one Bitcoin block is processed. Additionally, miners are rewarded with new Bitcoin.
To compensate for the increasing power of computer chips, the difficulty of the puzzles is adjusted to ensure the steady flow of new Bitcoins every day.
There are about 16 million in existence.