My computer doesnt reconize my iPod - please help!!

My iPod was working normally until it suddenly shut down and rebooted (as if I had done a soft reset with the Menu and Center button), then an icon of the charger and the words "Plug in to Restore" came up.

I now have it plugged into my computer but iTunes doesnt even know its there, my computer does reconize that a device is plugged in but asks me to "format the device"

I am currently updating my iTunes to see if that makes a difference, but I'm really stressed out about this!! What do I do?! 😮 😢