Bitcoin is a decentralized crypto currency with transactions being processed on millions of computers, called miners, working to constantly verify transactions via the web. Because of this, Bitcoin isnt controlled by a bank or a government, so its international and even the largest transactions can take place with very small transaction fees. Instead of PayPal and other virtual banks using real-world currency, it's a digital currency for digital transactions.
Making a purchase with Bitcoins is simple. Most websites will automatically generate a receiving address where Bitcoin can be sent to complete the purchase. On Square Market, for example, the purchaser is sent an email with this address. The address will automatically open in the purchasers wallet, allowing the customer to pay in one-click.