How exactly to interpret bitcoin is a matter of controversy – as a currency, a store of value, a payment network, an asset class?

Fortunately, leaving the economic debates aside, it's pretty easy to answer what bitcoin actually is – software. Don't be fooled by stock images of shiny coins bearing modified Thai baht symbols. Bitcoin is a purely digital phenomenon, a set of protocols and processes. It is the most successful of hundreds of attempts to create virtual money through the use of cryptography (the science of making and breaking codes), though competition is heating up.