From the Genesis Block to Adoption on Wall Street

Satoshi Nakamoto, the unknown Bitcoin creator, published the first customer network on this day 12 years ago and officially started what is perhaps the greatest currency revolution of the 21st century.

Six days earlier, on January 3, 2009, Satoshi dismantled the Genesis block known as # 0 and encoded it into the software. In contrast to the following blocks in the chain, the basic coin reward from the Genesis block cannot be issued, as only “coins” that have been publicly mined can be transferred. The first block, or # 1, was taken down on January 9th, giving the network as it is known today a real start.

At that time, Satoshi announced the news on the Cryptography mailing list with a download link for Bitcoin 0.1.0 on the open source software database platform Sourceforge.

Bitcoin 0.1.0 was only compatible with the Windows operating system. The first client version with Linux support was not released until December 2009 with the release of Bitcoin 0.2.0.

1.309 BTC

Less than a week before the first client software was released, Satoshi dismantled the Genesis block and started the network. Hal Finney received the first BTC transaction on January 12, 2009.

At this point in time, the early adopters were already informed about the possibility of making money with computing power. According to Finney, “The ability to generate coins with just a few cents of computing time today is a good choice.”

The programmer and cryptographer enthusiast famously predicted that Bitcoin could reach the status of a world reserve currency and reach $ 10 million per coin. Satoshi agreed with Finney’s optimistic expectations, adding, “It might make sense to get just a few if it catches on.”

It wasn’t until October 2009 that Bitcoin (BTC) received its first official rating. At that time, the New Liberty Standard, an early BTC exchange, created a reference price for Bitcoin from 1,309 BTC to $ 1.

Pizza, WikiLeaks and Satoshi’s exit

Early miners got flush with Bitcoin as the network is still in its infancy. Some even make bitcoin faucets that help encourage wider BTC penetration.

In May 2010, Laszlo Hanyecz cemented his place in Bitcoin folklore forever, paying BTC 10,000 for pizza in what is widely regarded as the first “real” Bitcoin transaction.

WikiLeaks, cut off from funding sources, turned to Bitcoin and some early adopters encouraged Julian Assange to consider a BTC adoption. Satoshi admonished Assange against the course of action, arguing that a connection with WikiLeaks could unnecessarily heat the young project.

In fact, Satoshi’s plea for Assange was one of the bitcoin creator’s last pieces of digital correspondence before leaving the scene entirely.

Silk road and mining

By 2011, Bitcoin seemed to evolve from a purely cypherpunk affair to the realm of anarchists and free market advocates. Silk Road, the defunct darknet marketplace, appeared on BTC as a popular payment method for illicit drug trafficking and other banned substances.

On the market side, Bitcoin claims the $ 1 milestone as the attention of the broader tech community begins to rise. Bitcoin was at $ 30 by mid-2011, but a theft of 25,000 BTC from a user’s Slushpool account caused a huge drop in prices.

Bitcoin mining also continued to evolve, as PCs could no longer provide enough hash power to secure the expanded network. Graphics processors and field programmable gate arrays now offer more efficient bitcoin mining capabilities.

Mt. Gox, Tech Adoption and Crypto Natives

Stellar founder Jed McCaleb founded the Mt. Gox Bitcoin exchange back in 2010. Fast forward to 2013, and the platform handled over 70% of the world’s BTC trading. Mt. Gox seemed too big to fail, but it actually failed when hackers stole around 850,000 BTC between 2011 and 2014. The news of the thefts caused another big drop in Bitcoin prices.

Meanwhile, the adoption of technologies increased, leading to the emergence of products such as BTC storage devices like Elliptic. The US crypto exchange giant Coinbase also took to the stage and raised $ 25 million.

In regulatory terms, the period between 2013 and 2014 marked the start of several governments to take notice of Bitcoin. China’s central bank banned banks from facilitating BTC transactions, while the US government auctioned about 29,000 BTC that were confiscated from Silk Road operators.

Large altcoins projects such as Ethereum emerged by 2015 when the founders were looking for digital currencies with features to fix perceived errors in the Bitcoin protocol. Mining took it a step further with the introduction of application-specific integrated circuits and the rise of industrial bitcoin mining.

Since no consensus was reached on the block size limit in August 2017, a chain split occurred in August 2017 that led to the creation of Bitcoin Cash (BCH). However, the real notoriety came when the price of Bitcoin rose nearly 20-fold from January 2017 to mid-December, almost exceeding the $ 20,000 mark.

Macro hedge funds, corporations and the rest of the institutional herd

Bitcoin’s rise to the $ 20,000 price level in 2017 was immediately followed by a significant and sustained crash that bottomed out at $ 3,800 in early 2018. The bear market would last for the remainder of the year, with several proponents advocating an institutional takeover as the next step in Bitcoin evolution.

Although Bitcoin is in a bear market, its fundamentals continued to improve. By mid-2019, the network hash rate had exceeded 70 exahashes per second – more than ten times the number of grains of sand on the planet. Bitcoin derivatives also picked up speed, introducing markets such as futures and options contracts. Mainstream companies like Fidelity announced plans for Bitcoin custody solutions.

In 2020, Bitcoin seemed to have become the darling of institutional investors, with hedge funds and companies seeking direct exposure to BTC. Some publicly traded companies have even put Bitcoin on their balance sheets and hold the highest-ranking cryptocurrency by market capitalization as a treasury reserve asset amid recurring currency devaluation policies in major economies.

Bitcoin shot above the $ 20,000 mark in late 2020 but didn’t stop there. Following successive reports from major companies buying BTC, the price soared again parabolically, despite having fallen 50% during the first COVID-19 sell-off in Q1 2020.

What’s next for Bitcoin?

It’s only just beginning of 2021, but Bitcoin has already hit over $ 42,000, double the magic number in 2017. In the 12 years since Satoshi released the first Bitcoin client, the network and the ecosystem itself developed out of being used in the Cypherpunks arena to grab Wall Street’s attention.

Related: Ready for Impact? After reaching $ 42,000, bitcoin price volatility may increase

During this time, gamers, darknet narcotics providers, failed nationals, techpreneurs, hedge funds, LLCs and everyday investors have come to the world’s most popular cryptocurrency. Perhaps government adoption is next on the agenda, and Bitcoin could become a reserve currency of a major world power. Would Satoshi be satisfied with such a result?