Bitcoin P2P Digital Currency

Bitcoin is an experimental new digital currency that enables instant payments to anyone, anywhere in the world. Bitcoin uses peer-to-peer technology to operate with no central authority: managing transactions and issuing money are carried out collectively by the network. Bitcoin is also the name of the open source software which enables the use of this currency.

The software is a community-driven open source project, released under the MIT license.

Bit Coin Payment Network

Bitcoin is a peer-to-peer electronic currency created by the pseudonymous entity, Satoshi Nakamoto. One Bitcoin (BTC) is divided into 100-million smaller units called satoshis.
Bitcoins can be sent, received and managed through various independent websites, PC clients and mobile device software.Physical banknote and coin forms can be traded as well.Internationally, Bitcoin can be donated, exchanged for goods and services or traded on exchanges for several other fiat currencies such as the US dollar.
Bitcoin uses cryptographic technologies and a peer-to-peer network of computing power to enable users to make and verify irreversible, instant online Bitcoin payments, without an obligation to trust and use centralized banking institutions and authorities. Dispute resolution services are not made directly available. Instead it is left to the users to verify and trust the parties they are sending money to through their choice of methods.
Bitcoins are issued according to rules agreed to by the majority of the computing power within the Bitcoin network. The core rules describing the predictable issuance of Bitcoins to its verifying servers, a voluntary and competitive transaction fee system and the hard limit of no more than 21 million Bitcoins issued in total.
Bitcoins do not have the backing of and do not represent any government-issued currency. The value of Bitcoins depends on the interpretation of the actions and software the Bitcoin network is based on. It is the first of a new breed of cryptocurrencies that do not require a central authority.

The Bitcoin network came into existence on 3 January 2009 with the release of the first open-source Bitcoin client, Bitcoind, and the issuance of the first Bitcoins.Prior to the invention of Bitcoin, electronic commerce could not securely operate without relying on a central authority to prevent double-spending. Nakamoto sidestepped the requirement of a central authority for Bitcoin by employing a proof-of-work approach in a peer-to-peer network to reach consensus in a network of computing power that validates the transactions.
Transaction fees may be included with any transfer of Bitcoins. At the moment, many transactions are typically processed in a way where no fee is expected at all. For transactions which draw coins from many Bitcoin addresses and therefore have a large data size, a small transaction fee is usually expected.
Prices fluctuate relative to goods and services more than more widely accepted currencies; the price of a Bitcoin is not sticky.
In August 2012, 1 BTC traded at around $10.00 USD. Taking into account the total number of Bitcoins mined, the monetary base of the Bitcoin network stands at over 97 million USD.

Source :http://en.wikipedia.org/wiki/Bitcoin & http://bitcoin.org/