Bitcoin is a digital currency that can be used as a form of electronic cash. You can think of it as a more advanced version of how your current ATM and Credit Cards work.
It was created by Satoshi Nokamoto as an open source project in 2009 and the source code is publicly available on Github here: BitCoin
When the bailouts happened in 2009, Satoshi wanted to create a new form of money where this could not happen again. With regular money, the banks have full control and can print more money anytime they want and can also take peoples money away anytime they want. Satoshi aimed to fix this by creating a new currency that is controlled by the people instead of the banks.
BitCoin allows for anonymous transactions with no third party. This makes it much easier for websites and businesses to accept money online. Currently, websites need to pay the credit card companies a fee in order to accept payments from them, and must also pay them a commision for each transaction. This makes it difficult for businesses to sell products with small fees. Similar to how a gas station will have a minium purchase amount to use a credit card, websites need to implement a minimum purchase amount to counteract the fees. With BitCoin, the goal is to eliminate these third parties and make it easy for everyone to make payments electronically.
To fully understand how Bitcoin works, read the BitCoin white paper here: BitCoin Whitepaper
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