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Like any form of money or asset, the bitcoin has its own share of booms and busts. This article walks you through into the timeline of the most prominent and popular virtual currency ever made – the bitcoin.
In August 2008, the bitcoin.org domain name was registered. A few months later, a developer or group of developers, who took the name Satoshi Nakamoto first described the protocol of the bitcoin in a paper published at The Cryptography Mailing List of metzdowd.com. Shortly, after that, the Bitcoin project was registered at the sourceforge.net, a site that lets anyone develop and publish open source software for free.
The first open source software, Bitcoin v0.1, was released in January, and the first transaction was recorded. It was made by Satoshi to someone named Hal Finney. In October, the exchange rate for bitcoin published by New Liberty Standard was at 1,309.03 for a dollar. The bitcoin network was born. People from around the world, mostly geeks, got so excited about the thought of an unregulated form of money that is very easy, convenient, and cost-effective to move across boundaries. A second version of the software was released towards the end of the year.
The currency exchange Bitcoin Market was established and trading began in February 2010. Among the first purchases made using bitcoins, the most notable transaction was for a pizza purchased in May 2010 at a price of 10,000 bitcoins. Owing to some difficulties encountered by the system at the end of 2009, another version of the open software was developed.
By the middle of the year, in July, there was a large influx of users after bitcoin was mentioned at a website called slashdot.org. In that same month, the world’s largest bitcoin exchange, Mt. Gox, was established. First bitcoin blocks were generated after that. Miners were using their own versions of technology.
October saw the release of the first public OpenCL miner. The first escrowed trade was recorded in the same month and by November the bitcoin economy had exceeded the US$ 1 million mark. Bitcoin was then trading at $0.50 a piece in Mt. Gox.
By January 28, 2011, the number of bitcoins generated had already reached 5.25 million. In the succeeding month, bitcoin.org had experienced difficulty handling the traffic as the bitcoin gained parity with the dollar, one bitcoin (BTC) per US dollar, at Mt. Gox. On February 15th, a car was offered in exchange for bitcoins at bitcointalk.org. It was a 1984 Celica Supra
Many firsts happened in March and April of 2011 when exchange markets for other major currencies were opened. Britcoin, the market for converting bitcoins to and from British Pound Sterling (GBP), opened on March 27th. Also, Bitcoin Brazil opened in end of March while BitMarket.eu, the first platform for exchanging the digital currency to and from Polish z?oty opened on April 5th. In the same month, the first put option contract was sold in an over-the-counter marketplace Bitcoin-OTC. The popularity of bitcoin rose as the TIME wrote about bitcoin on April 16th. Not long after that, the bitcoin had reached parity with both Euro and British Pound Sterling.
During the start of June, 2011, the price of bitcoin went up to US$10. In June 8, 2011, the price of a single bitcoin escalated tremendously to reach a peak of $31.91 before tumbling down to the pits and losing over 90 percent of its value over the course of the subsequent four months. By then the market capitalization was about US$206 million. In June 19, the price went down on a free-fall from $17.51 to $0.01 per bitcoin. The database of Mt.Gox got exposed to a nasty hacker who issued sell orders for fake bitcoins. Because of this, Mt. Gox’s trading was suspended for a week. Other exchange markets abroad were also briefly halted as they reviewed their own security measures.
Despite the uncertainties, the bitcoin economy remained. In August, the first conference on bitcoin was held in NYC. And in November, the first in Europe was conducted in Prague.
In June 2012, Coinbase, a digital wallet for bitcoin and platform for transacting using virtual currency, was founded. In the early part of 2012, the largest theft in the bitcoin network was recorded involving 50,000 bitcoins. After this, the Pay-to-script-has went live. In September, the Bitcoin Foundation was created. This aims to protect, promote, and standardize the use of cryptographic money to benefit all its users. The popularity of bitcoin continued. In fact, in October, the site BitPay noted that there more than 1000 merchants which accept bitcoin.
The price of bitcoin from the middle of March until the 9th of April had a staggering rise from only around $50 to $240, an increase of about 400 percent. This remarkable appreciation was the result of speculation, and also partly because of the inherent and better way this digital money was designed. Its appeal stems from the predetermined rate of increase in its supply, which is a great advantage over the paper currency’s susceptibility to inflation. Moreover, the steep rise in the bitcoin price also reflects the anxiety of people over the security of the global financial system as well as major currencies like the euro.
But everyone now knows that this was followed by the most shocking fall of bitcoin that had surpassed any crash the stock market has ever known since the Great Depression. And in April 11 to 12, Mt. Gox suspended the trade to let the market settle. When it re-opened the price further fell to $62.59. The exchange was suspended once more on April 13th to let its engine cooldown.
Despite the uncertainties and phenomenal bursts, the bitcoin economy has not wavered at all. This is attributed to the fact that it somehow fills in a space that the traditional currencies could not venture into. The absence of a regulatory body makes the currency very palatable particularly to those who are into illegal business. After all, everything is anonymous in bitcoin transactions.