So I recently got interested in Bitcoin, and have been trying to learn more. I was reading the Satoshi whitepaper on Bitcoin and came across a diagram of transactions (I can't post pictures yet so I have attached a link to the paper, the image is on page 2 nearest the top: https://bitcoin.org/bitcoin.pdf) I was wondering if someone was able to explain this a bit better for me. My understanding, as the white paper seems to say, is that Bitcoin is a chain of digital signatures that works as follows: "Each owner transfers the coin to the next by digitally signing a hash of the previous transaction and the public key of the next owner and adding these to the end of the coin." So would that mean taking the previous transaction and hashing it together with the recipient's public key, and then encrypting it with your private key in order to create a signature? Is the previous transaction just represented by a signature? I realize this question is a bit dense, but any explanation about how transactions actually work would be very beneficial.