How does Bitcoin work?

[Meganthemeiguoren]

We are learning about currency in my Political Science course and how modern-day money's only true value is the value of the government promise backing it up. We mentioned the bitcoin in class, and I think it's interesting as an example of a kind of experimental currency, but how exactly does it work?

More specifically, if there is no government backing up the worth of a bitcoin or regulating its supply, then how can consumers confidently use bitcoins and how can sellers accept it as valid currency? Who controls the bitcoin supply, and with the whole "mining" thing, then couldn't people just artificially make their own bitcoins and unbalance the system? And isn't it actually very risky to pour a lot of real money into bitcoins because governments could someday prohibit the use of bitcoins and then all of the users' money would be lost?

Thanks in advance for helping out a confused and technologically illiterate student

[sunil]

Bitcoin is just the Electronic Money that can be safely transfer from one organization/party to another.

But there is certain rules to use them and we have follow them to use Bitcoin safely......

It is used instead of directly transfer money online .....