Cryptocurrency On The Rise: A Brief History of Bitcoin

Originally published in Las Vegas Citylife on January 16, 2014

October 31 2008. The entity or group known as Satoshi Nakamoto publishes the paper detailing the peer-to-peer electronic cash system known as Bitcoin. Reception is mixed.

January 3, 2009. Known as the Genesis Block, the first link in the Bitcoin blockchain is mined. Embedded in the binary data of the block is the quote “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”

January 12, 2009. The first Bitcoin transaction takes place when Satoshi Nakamoto transfers 10 BTC to developer and cryptographer Hal Finney as a test.

October 5, 2009. New Liberty Standard publishes the first BTC to USD exchange rate, with the initial rate valuing 1,309.03 BTC at one dollar.

May 22, 2010. The first trade for goods takes place when member Laszlo Hanyecz purchases two pizzas from a volunteer in England for 10,000 BTC.

July 17, 2010. Initially a Magic the Gathering collectible card trading site, MtGox pivots, establishing itself as a Bitcoin exchange.

November 6, 2010. With 4.5 million BTC in circulation, Bitcoin market capitalization passes $1 million.

April, 2011. Satoshi Nakamoto vanishes.

February, 2011. Silk Road, an online marketplace where users can exchange Bitcoin for drugs and other illicit goods, opens its doors as hidden service using the Tor anonymity network. “The general mood of this community is that we are up to something big, something that can really shake things up. Bitcoin and Tor are revolutionary and sites like Silk Road are just the beginning.”

February 9, 2011. For the first time ever, Bitcoin reaches exchange parity with the US dollar.

June 9, 2011. Bitcoin skyrockets, peaking at a new high of $ 31.91 on MtGox. Unfortunately, it will drop to nearly half that value within days. Detractors cry “Bubble!”

June 19, 2011. MtGox is hacked, with false sell orders for thousands of fake Bitcoins driving the price per BTC down to $0.01. Trading is halted for one week while the security breach is resolved.

March 1, 2012. 46,703 BTC (now valued at $39,980,000) are stolen after web hosting company Linode is compromised, giving the hacker access to the Bitcoin wallets of eight users stored on the company’s servers.

September 27, 2012. The Bitcoin Foundation, created to standardize, protect, and promote the use of Bitcoin, is formed.

January 30, 2013. Jeff Garzik, a Bitcoin core developer, receives and activates the first commercially sold Avalon ASIC (Application Specific Integrated Circuit) Bitcoin miner, drastically upping the bar for mining hardware. Operating at 67.5 GH/s, the unit pays for itself in nine days.

February 28, 2013. The MtGox exchange rate reaches $32, surpassing the previous high for the first time since June 2011.

March, 2013. The government of Cyprus announces a bail-in for banks, resulting in rush from consumers to withdraw funds from their accounts and place them in locations secure from government fingers. A great many chose Bitcoin, pushing the price of BTC to an all-time high.

March 28, 2013. The Bitcoin market cap passes $1 billion.

April 1, 2013. Bitcoin exchange rate exceeds $100.

April 10, 2013. The MtGox Bitcoin exchange rate spikes to a high of $266 before immediately plummeting to less than half that value.

October, 2013. In the midst of a housing and stock market bubble, Chinese investors looking for new action create an unprecedented demand for Bitcoin.

October 2, 2013. The FBI arrests alleged Silk Road founder Ross Ulbricht, shuttering the service and seizing over 170,000 Bitcoins. At the time of its closure, the site had facilitated $1.2 billion dollars in sales, earning $80 million in fees.

October 29, 2013. The world’s first Bitcoin ATM, developed by Las Vegas startup Robocoin, is deployed in Vancouver, Canada. Within one month it will exceed over $1 million CAD in transactions.

November 21, 2013. The University of Nicosia, in Cyprus, becomes the first accredited university to accept Bitcoin for payment of tuition.

November 29, 2013. For the first time ever, one Bitcoin equals one ounce of gold in value ($1242). Unfortunately, it will drop to nearly half that value within days. Detractors cry “Bubble!”

December 5, 2013. The China Bubble pops as the People’s Bank of China bans banking institutions from handling Bitcoin transactions, stating that while the public can take on the risk themselves and participate in Internet transactions, the currency itself has no real meaning or legal status. Bitcoin plummets.

January 4, 2014. Social game behemoth Zynga announces that it will immediately begin accepting Bitcoin as payment for virtual goods in seven of its online games, including FarmVille 2.

January 5, 2014. Bitcoin rebounds to above $1000 and holds most of its gains.

January 9, 2014. becomes the world’s first major retailer to accept Bitcoins. Items most purchased by Bitcoin users include sheets, mobile phone cases, flash drives, and bath towels.

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