Bitcoin Development History
Today is Bitcoin tenth birthday, what happened to Bitcoin during these ten years? Let’s review its history together.
Bitcoin itself did not exist until the late 2000s. However, for its origins, we could trace back to a few decades ago.
Bitcoin can be actually tracked back to 1982. That is when computer scientist David Chaum first proposed the concept of e-Cash. Chaum has already concerned with the privacy aspects in the digital realm back in the early 80s, a published paper entitled “Blind signatures for untraceable payments” also detailed a new form of cryptography which he claimed could allow for an automated payment system where third parties could not see information on the payment.
However, the proposal did not come to fruition.
Finally, Bitcoin came out in 2008. In August of that year, Bitcoin.org was registered. Two months later, a whitepaper was published: “Bitcoin: A Peer-to-Peer Electronic Cash System.” The whitepaper’s idea had similar ambitions to the previously mentioned papers: secure digital signatures, not requiring the use of a third party, proof-of-work, and hashing the transactions together to form a chain.
Satoshi Nakamoto, an unknown person or group of people, wrote the Bitcoin paper.
Just a few days into 2009, the first-ever block of Bitcoins, known as the Genesis Block, was mined. By Jan 9th, the first iteration of Bitcoin software was released, and on Jan 12nd, the first-ever bitcoin transaction occurred as Nakamoto sent 10 Bitcoins to noted computer programmer and developer Hal Finney.
With an exchange rate established, it was only a matter of time until someone attempted to make an actual purchase with Bitcoins. In May of 2010, it happened. Florida-based programmer Laszlo Hanyecz sent 10,000 BTC to a London man in exchange for two pizzas, valued at a total of $25. This still valued a single Bitcoin as a fraction of a penny, but with a purchase made, intrigued parties saw potential in the product.
A pivotal year for the exchange of Bitcoin, fittingly the first Bitcoin exchanges popped up in 2010 as well — Bitcoin Market in February, and Mt. Gox in July. Slush, which is the first mining pool, also mined Bitcoin successfully for the first time that year. Mining pools are where several miners combine resources to get Bitcoin. By November, the market cap for Bitcoin surpassed $1 million for the first time.
Not that it was all ups for Bitcoin. Someone spotted a vulnerability in Bitcoin’s protocol in October that allowed for transactions without proper verification and exploited it, generating 184 billion BTC. The transaction was soon erased and the vulnerability fixed.
Steadily making gains in value after finally passing 1 cent threshold, in February 2011 a major milestone occurred: 1 Bitcoin was worth $1 for the first time.
Bitcoin began receiving press — both positive and negative. TIME Magazine published an article on Bitcoin for the first time, but the same year there was also an article on Gawker detailing Silk Road, the dark web drug market where Bitcoin was frequently used as payment. The publicity got people talked and discussed, and by June, Bitcoin was worth over $30. Soon after, it crashed back down to about $10.
If 2011 was a choppy year for Bitcoin, 2012 was smoother sailing. Among notable moments for Bitcoin on its way to becoming the world’s top digital coin was its crossing the $100 threshold in April.
Bitcoin’s price saw its share of ups and downs in 2013, but it passed a value of $1,000 for the first time and was becoming the most recognizable and successful wallet and exchange available.
And then, it stalled for a while. Quickly in January 2014 it fell below $1,000 and struggled below the key level for a few years.
2017, though, was the biggest and busiest year for Bitcoin. After spending 2016 desperately trying to claw its way back up, 2017 was when it finally reached and passed the $1,000 mark. It kept ascending. By June, Bitcoin was worth over $3,000.
Still, for the remainder of 2017 Bitcoin was on an upswing. By October, it was topping $6,000. It ended November at nearly $10,000, and by the end of December, Bitcoin hit a peak of $19,783. More and more people and companies began chasing the trend as the price just kept rising. Unsurprisingly, it wouldn’t continue that heady growth.
2018 has been a tough year for Bitcoin investors, especially for those one who held on assuming the price would keep ascending. Many investors sold their Bitcoins while they could, and the price has steadily dropped all year.