A bounty is money on a post, that will be distributed to the top level comments of the post, depending on how many votes they receive.
So for instance you can use this if you want to aske a question and incentivice people to give you a great answer.
But you could also just use it to give users rewards for interacting with you or sharing their opinion or anything like this.
Does that clear things up?
By 'top level' comments, do you mean comments with high payouts or comments with number of votes? Cause if it is high payouts, can't they just upvote theirselves and get the bounty?
Also does it only count parent level comments? How about replies to comments? :)
Top level means direct response to the post (not responses to responses). So in this thread only the comment from @articfoe is a top level comment.
And yes you can upvote yourself. But most of the bounty is distributed via the bounty creator and you can get flagged.