A Short History of Bitcoin EVERYONE Needs to Know

Although it’s often referred to as new, Bitcoin has existed since 2009 and the technology it is built on has roots going back even further than that. With that said here is a brief history of Bitcoin for the uninitiated....

Although Bitcoin was the first established cryptocurrency, there had been previous attempts at creating online currencies with ledgers secured by encryption. Two examples of these were B-Money and Bit Gold, which were formulated but never fully developed.

Then in 2008 a paper called Bitcoin – A Peer to Peer Electronic Cash System was posted to a mailing list discussion on cryptography. It was posted by someone calling themselves Satoshi Nakamoto, whose real identity remains a mystery to this day. Subsequently in 2009 the Bitcoin splatform was made available to the public for the first time and mining of the 21 million bitcoins began.

As it had never been traded, only mined, it was impossible to assign a monetary value to the units of the emerging cryptocurrency. In 2010, someone decided to sell theirs for the first time – swapping 10,000 of them for two pizzas. If the buyer had hung onto those Bitcoins, at today’s prices they would be worth more than $100 million. That must have been some damn good pizza.

Around 2011, as Bitcoin increased in popularity and the idea of decentralized and encrypted currencies catch on, the first alternative cryptocurrencies began to appear. These generally tried to improve on the original Bitcoin design by offering greater speed, anonymity or some other advantage.

Currently there are over 1,000 cryptocurrencies in circulation with new ones frequently appearing. In 2013, shortly after the price of one Bitcoin reached $1,000 for the first time, the price quickly began to decline. Many who invested money at this point suffered losses as the price plummeted to around $300...it would be more than two years before it reached $1,000 again. Bitcoin then suffered a blow in January 2014 when the world’s largest Bitcoin exchange Mount Gox went offline, and the owners of 850,000 Bitcoins never saw them again.

However despite this and other set backs a gradual increase in the places where Bitcoin could be spent contributed to its continued growth in popularity, during a period where it’s value remained below previous peaks. Gradually as more and more uses emerged, it became clear that more money was flowing into the Bitcoin and cryptocoin ecosystem. During this period the market cap of all cryptocoins rose from $11bn to its current height of over $300bn, mainly fuelled by growth in Bitcoin. Banks including Barclays, Citi Bank, Deutsche Bankand BNP Paribas are investigating ways they might be able to work with Bitcoin, with Goldman Sachs even committing to setting up a cryptocurrency trading desk in 2018. Meanwhile the technology behind Bitcoin – blockchain – has sparked a revolution in the fintech industry which is only just getting started.

So there it is, a brief history of bitcoin. As for the future of bitcoin and the cryptocurrency market as a whole? That remains to be seen, but I for one am very optimistic about its prospects.