Invented by Satoshi Nakamoto, Bitcoin is an online payment system. He first published his invention in 2008 and in a research paper called "Bitcoin: A Peer-to-Peer Electronic Cash System", Nakamoto implemented Bitcoin as open source code and released in January 2009.
Bitcoin, symbolized as "BTC", uses a peer-to-peer system where users can transact directly without the need of an intermediary. As a cryptocurrency, Bitcoin is described as the first decentralized digital currency.
In January 2009, the Bitcoin network came into existence with the release of the first Bitcoin client and the issuance of the first Bitcoins. Nakamoto was the the person mining the first block of Bitcoins ever, which had a reward of 50 Bitcoins.
Nakamoto is estimated to have mined 1 million Bitcoins. Before stopping his involvement with the cryptocurrency, Nakamoto handed over the reins to developer Gavin Andresen, who then became the Bitcoin lead developer at the Bitcoin Foundation.
Bitcoin users have a wallet to store their Bitcoins. The currency uses public-key cryptography, in which two cryptographic keys, one public and one private, are generated. A wallet is a collection of these keys. The first wallet program is called Bitcoin-Qt.
What further differentiate Bitcoin and other method of payment is its privacy. Bitcoin transaction can be achieved without identifying the owner's information. This has made the popularity of Bitcoin rises in a small time as a way to pay goods and services on the internet.
And because Bitcoin was designed to be decentralized, it doesn't need a central authority to control it.