WASHINGTON (Michigan News Source) – Imagine you have a bunch of digital tokens that only exist on the internet – kind of like Monopoly money, but people actually accept it for real goods and services. That’s cryptocurrency.

Unlike the dollars in your bank account, crypto isn’t controlled by a central authority like the government or a bank. Instead, it runs on something called a blockchain, which is basically a giant, unchangeable digital ledger that records every transaction. There’s no waiting for banks to process payments – just quick transactions stored across thousands of computers worldwide.

Bitcoin: the granddaddy of digital cash.

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Bitcoin (BTC) was the first cryptocurrency and remains the most recognized among the public. It was created in 2009 by a mysterious figure (or group) known as Satoshi Nakamoto. It was designed to be a new kind of money – digital, decentralized, and immune to government manipulation. Unlike the dollar, which the Federal Reserve can print endlessly, there will only ever be 21 million bitcoins, making it a scarce resource. People call it “digital gold” because, like gold, it’s scarce, difficult to “mine” (through digital verification and blockchain transaction processing), and valued as a store of wealth, i.e. an asset that holds its purchasing power over time.

Since Bitcoin’s debut, thousands of other cryptocurrencies have emerged, with new ones being developed all the time, spreading crypto ownership across a larger number of assets rather than being concentrated in bitcoins or a few major coins.

When Bitcoin was introduced, it had no initial monetary value. One of the first recorded transactions occurred on May 22, 2010, when 10,000 bitcoins were exchanged for two pizzas, valuing each bitcoin at a fraction of a cent.

The value of a bitcoin, and the value of other altcoins (anything that isn’t a bitcoin), has been on a rollercoaster lately following President Trump’s announcement regarding his new crypto strategic reserve plans. Bitcoins surged past $95K each after the announcement but quickly dropped to around $78K. One bitcoin is trading at a little more than $91K this morning – although it continues to fluctuate. While the initial spike was likely fueled by optimism over Trump’s move for creating a reserve, the sharp decline was most likely caused by uncertainty under recent moves by the president in addition to other factors.

Crypto experts point to multiple factors influencing the current volatility of crypto, including Trump’s tariffs, layoffs initiated by DOGE, a hawkish Federal Reserve, BlackRock’s recent decision to shift $150 billion into the crypto market, and North Korea’s hack of approximately $1.5 billion in virtual assets on the cryptocurrency exchange, Bybit, on February 21st.

How do you even use this stuff?

You can buy bitcoins on an exchange (like Coinbase, Binance, or Kraken), store it in a digital wallet, and then use it to buy things – though most people just hold on to it hoping the price skyrockets. Some companies accept bitcoins but it’s mostly used as an investment. You can also keep cryptocurrency in your own digital wallet.