Decentralized System: Bitcoin doesn't rely on any central authority, like a bank or government. Instead, it is run by a network of computers (nodes) spread around the world. This decentralized nature ensures that no single entity has control over Bitcoin, making it resistant to censorship and centralized manipulation.

Blockchain Technology: Bitcoin transactions are recorded on a public, transparent ledger called the blockchain. Each "block" contains a list of transactions, and blocks are linked together in a chain. This creates an immutable history of all Bitcoin transactions, ensuring transparency and security.

Transactions: When someone sends Bitcoin to another person, a transaction is created. This transaction includes:

Transactions are then broadcasted to the Bitcoin network, where miners validate them.

Mining and Proof of Work: Bitcoin relies on a Proof of Work (PoW) consensus mechanism. This means that miners (specialized computers) solve complex mathematical puzzles to validate transactions and add them to the blockchain. Once a miner solves a puzzle, the new block is added to the blockchain, and the miner is rewarded with newly minted Bitcoins (block reward) and transaction fees.

Security: Bitcoin is secured through cryptography. Every user has a private key, which is used to sign transactions, and a public key, which is the address to which others send Bitcoin. The blockchain uses cryptographic techniques to ensure that transactions are secure and cannot be altered or forged.

Supply Limit: Bitcoin has a fixed supply of 21 million coins, meaning no more than this amount will ever be mined. This limited supply is built into the Bitcoin protocol to prevent inflation and to maintain scarcity.

Wallets: To use Bitcoin, you need a wallet, which is a software tool that allows you to store your Bitcoin. A wallet has two components: a public key (your Bitcoin address) and a private key (used to sign transactions). If someone has access to your private key, they can control your Bitcoin.

Transactions Confirmation: After a Bitcoin transaction is broadcasted, miners validate and include it in the next block. A transaction becomes more secure as it gets more confirmations (when more blocks are added on top of it). Typically, a transaction is considered secure after 6 confirmations.

Lightning Network (Optional): The Lightning Network is a second-layer solution built on top of Bitcoin to enable faster and cheaper transactions. It creates off-chain payment channels between users, allowing them to transact without waiting for block confirmations.