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CoinTelegraph reviews the top five greatest moments in Bitcoin history that have left a mark, not just on the Bitcoin community but on the world.
Bitcoin is now seven and a half years old, or almost eight, depending on where you believe Bitcoin began - the concept's fertilization as a White Paper, or its actual open-source birth and first public transactions. Over that time, life has never been boring for young Bitcoin, with the digital currency becoming extremely popular throughout the criminal and online underworld, as well as the more tech-savvy and economically progressive among us.
Today, we’ll review the top five moments in Bitcoin’s rather spectacular history. Not the five best moments, nor the five worst, but the five greatest moments in Bitcoin history that have left a mark, not just on the Bitcoin community but on the world, starting with number five.
A tasty place to start. Clearly the most publicly noteworthy transaction in early Bitcoin history, if not the most significant. Jacksonville, Florida programmer Laszlo Hanyecz negotiated a deal with a Bitcoin Talk forum member in the U.K. to take 10,000 Bitcoin he had mined for $30 in Papa John’s pizza. This would make a Bitcoin worth less than $0.01 USD at the time. Today, those Bitcoins would be worth over $5.7 million USD. This single transaction proved to the world that Bitcoin had a mainstream monetary value for the first time.
Hanyecz told CoinTelegraph:
“It wasn’t like Bitcoins had any value back then, so the idea of trading them for a pizza was incredibly cool. No one knew it was going to get so big.”
- Image provided by Mashable.
Bitcoin had been making some waves in Spring 2013, quickly growing tenfold in value since the start of the year. The summer was tranquil in market trading, as per usual. Yet, during the movement in the fall of that year would not just change the Bitcoin community’s view of Bitcoin but would also put Bitcoin on the global map as a blue-chip investment, at least for a week or two.
From the start of October through to the end of November, Bitcoin pricing exploded from approximately $125 USD to over $1200 USD, forcing the world to take notice of what some called “The Future of Money.”
There are many factors in this “Bitcoin to the Moon” market bubble, including the release of Bitcoin to the Chinese market and some manipulative practices at the still dominant Mt. Gox exchange which would lead to its demise. But the bubble started to burst in December 2013, and would not fully correct itself until January 2015 when prices bottomed out at under $180 USD.
In association with the Bitcoin merchant account processor BitPay, Microsoft’s website began to accept Bitcoin payments for digital goods. The amount of Bitcoin that could be used per account was capped at $1000 USD. Microsoft did not make much of a public announcement to promote the move, but they said it took about three months to go from initial concept to implementation.
Eric Lockard, corporate vice-president of Universal Store at Microsoft at the time, said:
“The use of digital currencies such as Bitcoin, while not yet mainstream, is growing beyond the early enthusiasts. We expect this growth to continue and allowing people to use Bitcoin to purchase our products and services now allows us to be at the front edge of that trend.”
Mt. Gox had a profoundly positive effect on the growth of Bitcoin as a global currency. It was the origin of any type of official Bitcoin market valuation. It might as well have been the First International Bank of Bitcoin, at one time in early 2013 handling more than 70% of all Bitcoin transactions worldwide. Just like with a bricks-and-mortar commercial bank, Bitcoin users treated Mt. Gox the same way, trusting their entire account to Mark Karpeles and the rest of the company to handle.
- Image provided by Techcrunch.
Well, as with any Bitcoin exchange, there is a large amount of exchange risk involved. Whoever holds the Bitcoin’s private keys owns those Bitcoins, and Mt. Gox successfully traded over 150,000 BTC per day and held well over a million Bitcoins at its peak. After months of shaky price discrepancies with other exchanges, and accounting practices that could not be explained, on February 7th, 2014, Mt. Gox would no longer accept Bitcoin withdrawals.
Over 800,000 Bitcoins were said to be lost after the Japanese government investigation, except for those who had backed-up and protected their Bitcoins from such an event and who were able to retrieve their coins in the months to come. Mark Karpeles was arrested for multiple crimes, and the Japanese people thought for the next two years that Bitcoin had died because Mt. Gox had collapsed.
The future of money changed forever with the invention of the decentralized Bitcoin. The official White Paper was released on October 31st, 2013 by Satoshi Nakamoto, a previously unknown person/company/entity who remains anonymous to this day.
With the invention of Bitcoin, one needn't secure a bank account to use government issued paper notes to transmit value worldwide. One could not be discriminated against by age, location or identification. A 12-year old with a $10 cell phone, in an Indonesian mud hut, with a solar panel, 500 miles from the nearest banking facility, could hold their own personal bank in their hand.
Implemented as open-source code and released on January 3rd, 2009, the first transaction was 10 BTC sent from Satoshi Nakamoto to the late Hal Finney on February 12th, 2009. The world has never been the same since.
Peter Thiel, Co-Founder of Paypal, said:
“I do think Bitcoin is the first [encrypted money] that has the potential to do something like change the world.”
Honorable mentions: Ross Ulbricht/Silk Road, Departure of Mike Hearn, the Cyprus spike, BitPay founded, Bitcoin Bowl
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