May 22, 2010 is a day that will forever live as legend in cryptocurrency lore. On that day the first purchase with Bitcoin was made when two pizzas were purchased for 10,000 Bitcoin. At its peak three short years later, each one of those Bitcoins was worth around $1,200, and while the price hasn’t reached quote those astronomical levels in recent years, such a number might be possible in the near future.
However, the legendary pizza transaction is more than a fun historical factoid and a reminder at how the value of new technologies can change rapidly. It represents a purely digital experiment’s first foray into the real world of practical use, a bold statement that Bitcoin is real. Every year when we observe Bitcoin Pizza Day, we gauge how far the currency’s impact on the real world as grown. Here is what this year’s observations mean for Bitcoin:
What it means for value
The original Bitcoin purchase of two pizzas for 5,000 each represents a truly titanic sum today. That same amount of cryptocurrency would be valued at around $4.4 million today, which would buy 220,000 times the amount of pizza. The value of Bitcoin has been on a steady climb for the past year and a half, surviving the burst in its astronomical price bubble in 2014 and weathering numerous bumps along the road. Meanwhile, the consumer price index in the United States has shown that the dollar can buy significantly less over the last 45 years. The basic comparison of how much pizza you can get shows how strong Bitcoin is compared with prevailing government-controlled currencies.
What it means for trust in non-governmental structures
Another aspect of often-overlooked significance of buying pizza with Bitcoin is the trust it represents in non-governmental institutions. For centuries, people have trusted government and banks to issue the medium of exchange for day-to-day economic transactions, or otherwise been left with no alternative option. Using Bitcoin to buy food signifies trust in a decentralized technology with no bank or government involvement. This means that cryptocurrency is finally allowed to be weighed competitively against traditional currency in the court of public opinion.
What it means for adoption
The final signal that buying pizza with Bitcoin provides is a demonstration of its wide acceptance. Pizza is one of the iconic food staples associated with American culture and its influence globally, and the ability to acquire one is a good minimum competency test of any town in the United States (and a good litmus test for its cultural influence abroad).
While AirBitz lists only 58 pizza restaurants globally accepting Bitcoin, if operating with gift cards through Gyft, anyone can use Bitcoin to quickly and efficiently pay for pizza at several major chains, meaning that in the US one is almost always able to buy a Bitcoin pizza almost anywhere. That basic test anecdotally demonstrates that cryptocurrency’s time has come.
That first fateful transaction six years ago forever tied Bitcoin’s destiny to pizza. Every year we check the status of the relationship between the two in order to gauge the cryptocurrency’s progress anecdotally.
Pizza is telling us that 2016 is a year full of promise for the future of Bitcoin. Where will we be when 2017 rolls around?
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