Categories
Tech

10 years of Bitcoin, but is it over?

Halloween 2018 marks the 10-year anniversary of the foundations of Bitcoin, the world’s first cryptocurrency.

A decade ago today, bitcoin’s mysterious founder Satoshi Nakamoto published a nine-page long academic style paper called “Bitcoin: A Peer-to-Peer Electronic Cash System.” The paper would go on to act as the founding text for the cryptocurrency, and lead to the first bitcoin transactions being carried out in early 2009.

It’s impossible to say how much Bitcoin has increased in price single it’s the earliest days because its value back then was in the fractions of cents, however, based on the current price around $6,300, and its early price being less than $0.01, bitcoin’s value increased more than 1 million fold.

 

2008-2010: The 63 Million Dollar Pizza

The first bitcoin transactions were carried out in private and it is believed to have been between Nakamoto and developer Hal Finney. Many have speculated that Finney, who died in 2014, may actually have been Satoshi.

Bitcoin adoption grew slowly at first, with the cryptocurrency first catching mainstream attention in May 2010 on a day that has since become known as “Bitcoin Pizza Day.” It was May 22, when the purchase of the two Papa John’s pizzas by Laszlo Hanyecz from another bitcoin enthusiast marked what is believed to be the first “real-world” bitcoin transaction. Hanyecz traded 10,000 bitcoins for two large Papa John’s pizzas, a sale now worth around $63 million.

 

2013 onwards: Mainstream appeal

Bitcoin’s journey continued slowly at first, but it hit the mainstream in 2013. Later that year, the cryptocurrency spiked in value from around $100 per coin to $1,000 in just over a month, before halving in value over the next three or four months. Bitcoin would not hit $1,000 again until 2017.

For the next three years, Bitcoin stayed in a range of around $400 — never trading above $650 or much below $250. The most notable event during that time was the collapse of Mt Gox, the first ever exchange, which filed for bankruptcy protection after hackers stole nearly $500 million of bitcoin, and a further $30 million of cash deposits.

 

2017: THE CRAZY YEAR

After three years of relative calm, Bitcoin truly hit the mainstream in 2017, a year which saw the cryptocurrency increase in value from around $1,000 to almost $20,000 in a matter of months.

Part of the spearhead for that huge jump in value was the bitcoin “fork” which saw Bitcoin split into Bitcoin and Bitcoin Cash, after a group of Chinese developers decided to split Bitcoin’s original code in protest at what Reuters calls “improvements to the currency’s technology meant to increase its capacity to process transactions.”

2017 also saw the first major public efforts from financial institutions to get involved in cryptocurrencies, with two US exchanges, the CME and Cboe, creating platforms for customers to trade Bitcoin futures. Numerous major banks also announced projects involving crypto, which helped fuel the rapidly expanding bubble in bitcoin’s price. That bubble began to burst just before Christmas — only a couple of weeks after futures were launched — and by the end of January 2018, Bitcoin had fallen from around $20,000 per coin to just $10,000.

The falls were driven in part by rising fears that regulators planned to crack down on the cryptocurrency, which had largely operated outside the auspices of normal regulators until that point. Bitcoin continued to decline during early 2018, before eventually stabilizing at around $7,000 per coin. It has remained in the $6,000 to $7,000 range since June, and the volatility that characterised the market in 2017 and early 2018 has all but evaporated. On its 10-year anniversary, bitcoin is trading at $6,305, according to Coin Market Cap.

 

Bulgarian size of over 200,000 Bitcoins

A crackdown on organized crime by Bulgarian law enforcement in May 2017 resulted in the seizure of more than 200,000 bitcoins – an amount worth more than $3 billion in mid-2017.

 

The Balkans goes nuts in Mining!

By November 2017, the amount of energy spent mining bitcoin globally had exceeded the amount used on average by Ireland and most African nations. Bitcoin mining started to use more electricity than 159 individual countries. More than Ireland or Nigeria. According to market reports, bitcoin mining consumption relative to the country’s use of electricity went over 1000% in Kosovo, over 400% in Macedonia, over 100% in Serbia, etc.