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What is Bitcoin?

Bitcoin launched in 2009 as the very first cryptocurrency and continues to be the largest and most widely known digital currency today.

June 22, 2023

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So, what exactly is Bitcoin?

Bitcoin is a digital currency that can be transferred from person to person without using a third party, like a bank.

While you cannot transfer Bitcoin to others using the Plynk app, you can buy, hold, and sell it.

Today, Bitcoin is just one of thousands of cryptocurrencies that exist.

When was it created?

Bitcoin was launched in 2009 and continues to be the largest and most widely known cryptocurrency around the world.

A mysterious person (or group of people) using the name Satoshi Nakamoto created Bitcoin and the technology behind it. Their identity is still unknown to this day.

You can’t hold it in your hand

You know how you can go to the bank and take out a $20 bill?

There’s no option to physically withdraw Bitcoin or other cryptocurrencies like there is with cash. In other words, you won’t see anyone pulling Bitcoin out of their pocket to pay for groceries.

It exists 100% digitally, and behind the scenes each transaction is recorded on a worldwide database (without disclosing anyone's names).

Buying a slice (literally)

Similar to how you can buy a slice of a stock or fund—called a fractional share—you can do the same with Bitcoin.

In November 2021, Bitcoin hit its highest price: 1 bitcoin cost over $68,000.1 Very few people have that kind of money on hand at one time. So it’s quite common to buy $5 or $10 worth and own a tiny fraction of one.

A little fun fact: The first person to buy something using Bitcoin bought 2 pizzas. A surprisingly common purchase for such a complex, new technology!

Market volatility: It's up and it's down

The price of Bitcoin has had its fair share of ups and downs over the years. It may rise or fall dramatically, and since it can be traded 24/7, its value fluctuates constantly.

Between November 2021 (when Bitcoin surpassed $68,000) and January 2022, it lost over 45% of its value as the price dropped below $36,0001

What that means for you: Trading cryptocurrency can be risky so it’s important to decide for yourself if you’re comfortable buying it.

If you do decide it’s the right move for you, think about how much you want to invest in crypto. Make sure it’s not money from your emergency savings or that you may need to pay your bills.

Essentially, if you can’t afford to lose it, don’t use it.

Bitcoin’s limited supply

There’s a maximum supply of 21 million Bitcoin available in total. Satoshi Nakamoto set this limit so that it would hold its value over time.

As of January 2022, almost 19 million Bitcoin have already been created2.And every 10 minutes (on average), 6.25 Bitcoin are created.