Earlier this month, Bitcoin completed 15 years of its existence. Although the virgin crypto token trades above $41,500 per unit on the international crypto exchanges, its glory was noticeably lacking in the early days of inception.
Did you know that the very first transaction made in bitcoin took place on May 22, 2010 when 10,000 bitcoins were paid to buy two Papa John’s pizzas? Did you also know that it took three years and ten months for bitcoin to touch $1,000 for the first time?
Cut to January 10, 2024, US market regulator Securities and Exchange Commission (SEC) has given a green signal to start seeing a bitcoin ETF, garnering an investment of $4.6 billion within a few days.
How was bitcoin introduced?
The creator of Bitcoin Satoshi Nakamoto (pseudonym used by the inventor) published a white paper titled Bitcoin: A Peer-to-Peer Electronic Money System October 31, 2008 to crypto mailing list.
In fact, it took Satoshi two years to write the code before he completed the last task ie, the white paper.
He even mentioned that he had been working on bitcoin for two years when the white paper was finally published, writing: “I actually did this kind of backwards. I had to write all the code before I could convince myself that I could solve every problem , then I wrote the paper.”
He implemented the bitcoin software as open source code and released it in January 2009. Nakamoto’s identity remains unknown.
The total number of bitcoins is limited to 21 million. And by design, the number of bitcoins minted per block is reduced by 50 percent roughly every four years. The creator designed it to create its scarcity to increase its demand and price.
Earlier attempts before bitcoin
Even before bitcoin came into being, several digital cash technologies were released with David Chaum’s electronic money being the first in 1980s. In fact, the very idea that solutions to computer puzzles might have some value was first proposed by cryptographers Cynthia Dwork and Moni Naor in 1992.
Another attempt was made in 2004 when Hal Finney developed the first currency based on reusable proof-of-work. In particular, these attempts were not successful.
Term “cryptocurrency” was not used by Satoshi
It is intriguing to know that the terms ‘blockchain’ and ‘cryptocurrency’ were never used in the bitcoin white paper. Instead, Satoshi calls the blockchain a timestamp server.
Surprisingly, Satoshi named bitcoin quite late in the process and it is believed that he wanted to call it “electronic money” or “netcoin”.
In fact, in early emails that Satoshi sent to other scientists for review, bitcoin was referred to as “electronic cash” – a term that has been in use since the 1990s.
Where is bitcoin creator now?
Although Satoshi never revealed his identity, there are speculations that suggest that Satoshi is, in fact, the first bitcoin user Hal Finney or mathematician John Nash.
There are unconfirmed estimates that say Nakamoto had already mined nearly one million bitcoins before he disappeared a year later in 2010, but only after handing over the network alert key and control of the code repository to Gavin Andresen.
Gavin later became a lead developer at the Bitcoin Foundation, an organization founded in September 2012 to promote bitcoin.
What experts say about bitcoin completing 15 years
Some of the industry representatives MintGenie spoke to believe that bitcoin is poised to play a big role in the financial industry in the near future. Thanks to the approval to spot a bitcoin ETF by the US market regulator and the subsequent inflow of billions of dollars, there are expectations that bitcoin would soon regain its lifetime high of $67,566.83, which it touched on November 8, 2021.
Shivam Thakral, CEO of BuyUcoin, says, “The future importance of Bitcoin depends on its ability to face difficult circumstances, regulatory acceptance and adjustment to the changing environment will determine its continued significance. Despite competition and volatility, its well-established brand, scarcity and technical potential indicates that it is likely to continue to play a large role in the financial industry going forward.”
ALSO READ: Bitcoin ETF approval: Indian investors too can participate – here’s how
“As Bitcoin turned 15 this year, it has shown remarkable resilience in its journey as an asset class, from the fringes of crypto-punk communities to being touted as a ‘digital safe haven’ by the world’s largest asset manager, Blackrock. The journey has been volatile with shady bans, regulatory scrutiny and mining disruptions; but the network continues to soar with almost no downtime,” says Parth Chaturvedi, Investments Lead, CoinSwitch Ventures.
“The algorithmically tough interim schedule has run like clockwork and with an upcoming supply halving, we can expect the historic price cycle to repeat itself. The spot ETF approvals may have been a ‘sell the news’ event in the short term, but with over $10 billion of volume flow in the first week of trading, BTC cemented its place in risk-adjusted diversified portfolios,” he adds.
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Published: 22 Jan 2024, 13:27 IST