Money has an ancient history. It is known that man started off as hominid hunters, eating or disposing all the prey that they hunted. Then man became gatherers, and began to store objects for later use. Flint heads for weapons, skins for clothing, firewood for their caves for light and fire and such simple objects sufficed to satisfy the immediate needs of man. Then men started farming. The crops harvested not only satisfied immediate needs, but could be stored over much longer periods of time. Not all of the produce needed to be used at once, and was far in excess of the needs of an individual or a single family. This produced a surplus, and man used this surplus to exchange or barter for items of use that that person or family did not produce themselves. This created the first money, and as early as 5000 B.C. metal objects were known to have been used as money.

Money as a medium of exchange has to be backed by the highest authority of that country to be commonly used. Physically, it is issued by the highest authority of a country in the form of Coins and Paper Bank Notes which are actually promissory notes. Now money has entered a new, Digital phase. To the question, What is Bitcoin, the answer is simply that the backing of money by each Nation separately is no longer applicable, and Virtual Money has crossed all National Borders as Bitcoins.