In the same way than online banking where you can view the balance of each account, the Bitcoin software displays balance for each Bitcoin address you own. But in that case, where are stored the your Bitcoins?
Bitcoins are stored in your computer
Bitcoin your software works like a wallet containing cash. This money is yours and nobody can freeze your money on Bitcoin. By cons, if you lose your wallet, you can not get back the money it contained. Hence the importance to make a backup of your wallet
or to encrypt your wallet
, to prevent theft.
The keys of your Bitcoins, not the Bitcoins themselves
So the Bitcoin software retains your Bitcoins on your computer? Not exactly, because Bitcoins are nothing but a balance attached to a Bitcoin address. In the same way that the money you have in the bank is nothing but a number in a computer linked to your identity that you must prove to touch your money.
So in reality, what the Bitcoin software keeps is proof that you are the owner of your Bitcoin addresses. Each Bitcoin address that you create is associated with a secret key. The large Bitcoin network already knows the balance of each of your Bitcoin addresses. When you make a transaction
, your software uses the key stored in your computer to sign your transaction, proving to the network Bitcoin network you are the owner of that address. The transaction is then authorized.
Transfer Bitcoins between devices
For now, if you want to transfer Bitcoins between two devices, you can simply do a transaction between two devices that have different Bitcoin addresses. If the destination device contains no Bitcoinaddress, it is also possible to copy the "wallet" of a device to another. Similarly it may be possible in the near future to share Bitcoins addresses on multiple devices simultaneously.