If you asked someone ten years ago what “Bitcoin” was or what a “cryptocurrency” might do, all but those at the very cutting edge of blockchain technology would most likely have looked at you somewhat blankly. That’s because cryptocurrency wasn’t mainstream until fairly recently – it only even came into existence in the 2000s and did not boom until the following decade had arrived.
This article will trace the history of cryptocurrency (and especially its most famous variant, Bitcoin) through its early days and initial boom period all the way up to the present day, where it iscelebrated as a technology and community which is used for protection, value exchange, investment and much more.
The early history of crypto
Although for some people in the alternate banking field it might seem like it has been around for ages, cryptocurrency is actually very young. There were various attempts down the years to create a currency that could only be used in what was then the burgeoning online world, but many of them hit a brick wall due to the lack of a fool-proof ability to ensure that the asset created was immune to counterfeiting.
The breakthrough came with Bitcoin, which is by far the most famous cryptocurrency in the world. Bitcoin was technically born on 31 October 2008, when Satoshi Nakamoto – the pseudonymousfigure, or figures, behind its invention – published a paper entitled:‘Bitcoin: A Peer-to-Peer Electronic Cash System.’ This would turn out to be one of the most important documents in the history of cryptocurrency, as it is widely regarded to be responsible for the development of blockchain as we now know it.
Shortly afterwards, in January 2009 Nakamoto laid what has become known as the “genesis block” of blockchain. This block was a very early example of what is now called “mining”, or entering into the decentralised ledger that a transaction has occurred. Since then, Bitcoin has evolved in many different directions – and many people have added Bitcoin or one of the many alternative cryptocurrencies to their investment portfolios and made significant profits.
The Bitcoin boom
Various things happened to Bitcoin over the course of the next few years, including milestones like the first recorded value exchange: a purchase of two pizzas using blockchain. But the main event around this time was the arrival of investors – and price rises as a consequence. In the first half of the 2010s, Bitcoin experienced an enormous boom in price, followed by a drop and then another boom in 2017. In this latter boom alone, the value of one Bitcoin spiked by almost $20,000.
But the boom in the value of Bitcoin coincided with the arrival of other cryptocurrencies, too. Ethereum, which is one such cryptocurrency (and one which is perceived by many to be the second-most well-known crypto coin after Bitcoin) entered existence in July 2015. Now, there are thousands of cryptocurrencies in the world – and more are being generated all the time. There are themed cryptocurrencies, for example, while there are also crypto tokens which perform specific functions or serve specialisedcommunities. In some ways, crypto has become the ultimate example of the market meeting the needs of its users thanks to its diverse range of optionsand something to satisfy every customer.
Perhaps the most important trend in cryptocurrencies in recent years, though, has been the arrival of the “initial coin offering”. Initial coin offerings are often brought up in debates around crypto currencies vs fiat money, given that they mimic the initial public offerings seen in the “real world” of the stock markets. Initial coin offerings allow firms and founders to raise cash for specific aims, such as blockchain-powered companies or social projects, in a way that is similar to crowdfunding.
One concern is that initial coin offerings, or ICOs as they are known, can be fraudulent. But there are plenty of legitimate ICO opportunities out there – and with so many people still interested in investing in crypto, it’s unlikely that there will be any critical mass switch away from crypto any time soon.
As this article has outlined, cryptocurrencies have gone from strength to strength in what appears to be a very short space of time. From the days of Satoshi Nakamoto and that all-important “genesis block” to the recent explosion in popularity of initial coin offerings, cryptocurrency has both engrossed techies and led to profits for investors over its ten or so years in existence.