When Bitcoin hit the market twelve years ago, the concept of digital currency was still fresh on the minds of its users. Today, one of the richest men in the world, Elon Musk, invests in the virtual currency, making it an instantaneously valuable concept. In its short lifetime, the cryptocurrency has brought investors everywhere through a range of emotions, from booming to crashing on the drop of a dime. Regardless, Bitcoin has opened the door to the first successful online payment system entirely controlled by its users and decentralized from any governmental reign. Nonetheless, under its current level of fame, Bitcoin’s beginnings aren’t often discussed. That said, the origin of Bitcoin is essential to its development and standpoint in today’s industry. To shed some light on its expansion, we’ll uncover the details of Bitcoin’s humble history and explore the industry’s level of confidence in cryptocurrency—both past and present.
The term gets tossed around frequently in today’s economy, and many people still don’t fully understand the concept of Bitcoin, leaving plenty of people worldwide curious about what it is and how it works. In short, Bitcoin is its own currency. Like tangible cash, Bitcoin is shareable between users, although it is solely digital, without physical bills or coins to trade. However, unlike the American dollar, the Pound, or the Euro, Bitcoin is not tied to any one government entity, in particular, allowing it to be shared and used internationally. The currency is not technically “owned” by any one person. Similar to the technology behind the internet or email, Bitcoin merely runs itself as users trade currency back and forth. Hundreds of developers are consistently on the backend, ensuring its efficiency. Its decentralization makes Bitcoin valuable to many, alongside Bitcoin’s ability to remain mostly anonymous while sharing.
Bitcoin is a virtual currency a and only exists digitally. But, users can still exercise it to make purchases, both online and in person. Participants can send Bitcoins to other users, transferring them—or part of them—between digital wallets. For most users, Bitcoin is merely an app where you can purchase Bitcoins and use them to buy goods or services. The currency is recognized as very secure, and each transaction is recorded in an online payment list known as the “blockchain.” Each Bitcoin is traceable, making it difficult for any user to make copies or spend Bitcoins that aren’t owned by themselves.
The idea of cryptocurrency was first introduceda in 1998 by Wei Dai, who suggested a new type of currency that would rely on cryptography to control transactions. And, in 2008, Bitcoin began sneaking its way into the system—quietly but efficiently. Bitcoin.com was first registered online in August 2008. Only two months later, Satoshi Nakamoto made it known with a paper that passed around the cryptography list titled, “Bitcoin: A Peer-to-Peer Electronic Cash System.” The text explained Bitcoin’s concept, and many hopped on board. On January 3, 2009, the first software launched and was labeled the genesis block. Nakamoto sent over 70 Bitcoins to Hal Finney to test, and he ultimately became the face of who mined the first Bitcoins. Nakamoto partnered with other developers to improve the code and ensure Bitcoin’s usability. At its beginnings, Bitcoin was not worth what it is today and had no monetary value up until its first economical use in 2010. A Florida man made the first transaction with Papa John’s and traded 10,000 Bitcoin for two $25 pizzas.
Nakamoto vanished in 2011 after launching Bitcoin and establishing its presence. To this day, nobody is sure of who Nakamoto truly is, but they claimed to have “moved on to other things” after walking away from the software with around a million Bitcoins in-hand. Since then, Bitcoin has developed and evolved exponentially. Many cryptographers and developers have spent the past decade improving Bitcoin’s code and further increasing its value. As of today, one Bitcoin is worth approximately $38,000.
The unpredictability of Bitcoin has, since its beginnings, made it hard to get on board. Some countries, including places like Bolivia and Denmark, have banned the cryptocurrency altogether. But, why? What makes cryptocurrency like Bitcoin unimaginable or even untrustworthy? When Bitcoin first launched, almost nobody in the industry believed it would soar like it has. Many people didn’t take the cryptocurrency seriously until at least 2013, when plenty still doubted its value. Professional money experts, including the British professor Niall Ferguson, believed that decentralized currency was nothing more than a way to add deception to cash and promote fraud within the economy. Cryptocurrency in today’s world is considered trustworthy to many individuals, even some of the wealthiest individuals. That said, plenty of leaders and organizations do not believe in its abilities, nor do they accept it as a legitimate avenue for purchasing goods or services. Bitcoin, being a decentralized software, is not regulated, making it difficult for many people to trust. Cryptocurrency is often daunting as it can easily be manipulated and is extremely unpredictable, causing significant risks for investors. And, many governments have restricted and even banned the currency due to fear of illegal purchases and money laundering that could ultimately circumvent control.
Bitcoin is currently an extremely valuable asset in today’s economy. From its quiet origin to its current booming success, the cryptocurrency has gone through plenty of highs yet some profound lows. Despite the lack of trust in its overall concept, Bitcoin has flourished in only a little over a decade. Nonetheless, it maintains an unpredictability that leaves many to wonder where it will land next.