Bolts are installed by drilling a hole into the rock. There are two main categories of bolts: expansion bolts and adhesive bolts.
Expansion Bolts - Expansion bolts are hammered into a hole, then when the nut is tightened, a wedge inside expands the tip and prevents the bolt from coming out of the hole. Expansion bolts work well in really hard rock like granite or limestone.
Adhesive or Epoxy Bolts - Adhesive bolts are glued into the hole with a special epoxy adhesive. Adhesive bolts work better is softer rock like sandstone.
Bolt hangers are the pieces of metal that bolt to the wall. They have an opening that you can attach a rapide or chain to or that you can thread webbing through to rig a rappel.
Bolts are generally much stronger than other types of anchor and can be placed in locations that limit rope grooves or awkward rappels.
Bolts can loosen over time and become a hazard. For this reason, most bolted anchors have two bolts. Bolts are not allowed in many locations including many national parks. Many people, especially non-guided canyoneers, feel that bolts ruin the naturalness and difficulty of a canyon and make the canyon dumbed down.