Can someone properly explain Bitcoins to me?

A bitcoin is a form of monetary currency that can be sent through the internet to any location in the world, for free or for a nominal fee that ensures practically instantaneous confirmation of its transmission. A digital block of information, called the blockchain, stores a record of every bitcoin transaction that has ever taken place. Because copies of this blockchain are stored in computers all over the world and because these records are encrypted and linked together, it is extremely unlikely that anyone who is not the true owner of a bitcoin will ever be able to counterfeit it. It has been estimated that computing power needed to decrypt and alter the blockchain's record of bitcoin transactions after they have been confirmed exceeds the computing power of the ten most powerful computers in the world. People all over the world use special programs on their computers that ensure the informational integrity of the blockchain. These people, called miners, earn newly created bitcoins every time they confirm the integrity of a new segment, called a block, of the blockchain. This is the only way that a bitcoin can be minted. The special programs that are used for mining are designed so that no more than a total of 21 million bitcoins can ever be minted. So far, over the last four years, about a half of this total have been created. Because bitcoins have currency value, exchanges have been established which allow the conversion of bitcoins into US dollars, euros and other fiat currencies and vice versa. An increasing number of merchants throughout the worlds are accepting payments using bitcoins, which can be divided into units as small as you might want. Because the eventual supply of bitcoins will be limited, many consider bitcoins to be a safe harbor from the risks of inflation associated with fiat currencies. Since bitcoins were first created, they have, by far, outperformed the equity and precious commodities markets.

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