Short story is that bitcoin is a ledger that keeps track of where coins go. So if I give you a coin, and you give it back, 1 trillion times, we have a huge dat

Short story is that bitcoin is a ledger that keeps track of where coins go. So if I give you a coin, and you give it back, 1 trillion times, we have a huge database with two trillion transactions. But at the end of the day, nothing changed, I still have a coin and you don't, because you gave it back each time. Much of that data (i.e. 99.9999% of it, in this case) can be reliably thrown away for all practical intents and purposes. That's the gist of it. I'll spare you the technicalities (which I'm not intimately familiar with anymore myself, in any case), but the basic idea is that you don't need all data to run the network reliably. That, plus moore's law's equivalents for storage and networking, google them. They're not as strong as for CPU, but they're quite good anyway.