Whether it’s 2014 or 2019, it doesn’t matter. Bitcoin is now the only digital currency that everyone talks about and is interested in. It is the instrument that many uses to monitor the digital currency market.
The cost of Bitcoin continues to dominate public discussion from the peaks of 2018 to the very lows of 2019. Just look at any crypto news resource, major news sites and you’ll see all sorts of news and speculation about it.
Bitcoin is still the supreme ruler. Whatever occurs to Bitcoin, it impacts nearly 99% of altcoins out there. After all, Bitcoin was perhaps the first on the market.
It’s only natural for people to be fascinated by its price! If you’re one of such people, and you’re keen to learn about all the ins and outs of BTC’s price like its history, the factors affecting it, as well as the trends, you’re with the right article.
That same price is what’s driven millions of people to trading it with systems like Bitcoin Loophole and on exchanges. So you need to be aware of it when approaching the industry.
How the Pricing Started
There wasn’t a cost attached to it when Bitcoin was launched as no one was prepared to purchase it. The first time that Bitcoin gained value was when Martti Malmi, a Finnish developer who helped Satoshi in the development, sold 5050 Bitcoins for a cheaply $5.02 on Oct. 12, 2009.
This gave the value of $0.0009 to 1 Bitcoin. At its peak, this same coin on Dec. 18th, 2017 was $20,089.
The Early Days
Bitcoin was created at the start of October 2008. This was the month Bitcoin’s creator, Satoshi Nakamoto, released a white paper called Bitcoin.
The paper is addressed as A Peer-to-Peer Electronic Cash System in an Internet cryptography mailing list. In the article, they outlined the need for a fresh payment scheme to address traditional currency and economic institutions’ long-standing issues.
Satoshi explained that their development of a virtual, decentralized currency called “Bitcoin” is the answer to such issues.
They conceived that Bitcoin would act as an “electronic payment system that relies on cryptographic proof rather than trust, allowing any two willing parties to deal directly with one another without a trusted third party.”
But while Satoshi’s proposal was completely groundbreaking–the kind the world had never seen before–it didn’t come anywhere close to the kind of effect that it had now.
The reason for this is that the paper’s Internet cryptography mailing list was extremely niche–targeting those concerned in cryptography.
2009: Pre-Exchange Listing Period
It was on January 3, 2009, that Bitcoin came to life when Satoshi mined the genesis block (block number 0), allowing him to collect a 100 Bitcoins mining reward. On January 12, 2009, the first Bitcoin transaction occurred, and it was a transaction from Nakamoto to Hal Finney, a programmer.
From the very beginning, Finney was an enthusiastic supporter and contributor to the Bitcoin protocol, so he was rewarded with 10 Bitcoins for his hard work.
The price of mined Bitcoins was decided through individuals trading BTC on a Bitcoin forum in those early stages before Bitcoin was listed on an exchange. There was no specified price to look at–so it was entirely a seller-buyer negotiation to agree on the value of BTC.
To illustrate how niched BTC was in those days, consider that a user unsuccessfully attempted to auction off 10,000 Bitcoins for $50 by the handle “SmokeTooMuch” in March 2010.
A particularly notable transaction took place during this moment, on May 22, 2010, one that has already strongly cemented itself into Bitcoin history.
Dubbed “Bitcoin pizza,” a Florida programmer named Laszlo Hanyecz transacted what is thought to be the very first Bitcoin transaction in the real world. He bought two pizzas for a cool 10,000 Bitcoins from Papa John.
Using the current Bitcoin exchange rate (August 2019) at the moment of writing, those two pizzas would be worth a stunning $108 million!
BTC’s price on July 12, 2010, rose by 900 percent from $0.008 to $0.08 in just 5 days for 1 Bitcoin. The famous cryptocurrency exchange Mt. Gox was introduced five days later.
In October 2010, for the first time, BTC moved a bit, that is, $0.125. Not only did the share capital of Bitcoin reach $1 million a month later, but its exchange rate on MtGox got $0.50 per 1 BTC.
On June 8, 2011, Bitcoin encountered its first significant bubble when it reached $31–and subsequently, its first significant price falls when it plummeted 68 percent in the days that followed. For the remainder of the year, the price continues to fall, ending the year at around $2.
Other Drivers and Events on Bitcoin Price
1. Competitors Sprang Up
The emergence of altcoins in 2011 was also the year that alternative cryptocurrencies started to populate the digital currency landscape.
Examples of the altcoins that emerged are GeistGeld, Namecoin, Fairbrix, and SolidCoin, created from the open-source code of Bitcoin. Notably, this was also when Litecoin was formed, a cryptocurrency being sold as “the silver to the gold of Bitcoin.”
Competitors emerging through the introduction of altcoins intended that BTC would never again have a complete market monopoly.
2. More highs and lows In 2013
As in previous years, several occurrences affected BTC’s price positively and negatively over the rest of the year. By the end of March, the capitalization of Bitcoin exceeded $1 billion. In October, the first Bitcoin Automated Teller Machines were launched, opening the door to more government acceptance.
3. Government Role
As for the lows, in April, the cost of BTC fell 71 percent in just 12 hours from $233 to $67. Another incident that originally appeared to be at the top of the lows list was the FBI shutting down the Internet black market (Silk Road) in October and seizing about 26,000 BTC from user accounts.
Bitcoin was used on Silk Road as the main means of payment, so its closing marked the end of an important avenue of real BTC use.
Interestingly, while many pundits were expecting its closure to result in a huge fall in BTC prices, it did the opposite. Although on October 1 it dropped from $125.49 to under $100 the day after, it had already begun to recover to $116.82.
The price kept increasing and growing for the remainder of the year–ultimately reaching on November 30 a new all-time $1,122 high.
However, the high did not last, with the cost more than halving in mid-December, the same time as the People’s Bank of China banning the use of BTC by Chinese financial institutions.
4. The Theft of Mt. Gox
The year 2014 will be marred forever in the history of Bitcoin as the year of the Mt. Gox event. Mt. Gox was launched in 2010. It saw excellent achievement as it became both the leading Bitcoin exchange and the biggest Bitcoin dealer by 2013/2014 when it handled more than 70% of all Bitcoin transactions globally.
However, the exchange reported in February 2014 that in February 2014 about 850,000 Bitcoins belonging to its users were missing. The loss was over $450 million. As a result, the exchange was compelled to stop withdrawals.
On the whole, the Mt. Gox incident shook a large amount of cryptocurrency traders ‘ trust. Bitcoin’s price fell to $500 with decreased confidence and significant losses, before returning to the $600 to $700 range. The incident is still mentioned as an instance of the intrinsic issues with cryptocurrency transactions.
2014 was also the largest competition Bitcoin has ever had in terms of relative market cap from Ethereum.
The year 2015 was a comparatively silent year, with no significant peaks or lows, nor incidents that influenced its price considerably. By beginning the year at $315 and ending at $426, BTC encountered a gradual price increase.
Initially, its price steadily increased consistently, though at a slightly quicker rate than the past year, into 2016. BTC’s price picked up significantly around June, where it reached $772, just to fall back.
BTC had a bull run from August to December–with the price increasing significantly mid-December to finish the year at $953.
As far as BTC is concerned, growth in both 2015 and 2016 has been fairly constant.
Positive advances lead to fresh peaks for Bitcoin developments. 2017 was a very beneficial year–with both increased user and company acceptance.
For example, over the previous year, 4.6 times more Japanese online stores started accepting BTC, and Poloniex’s cryptocurrency exchange witnessed a rise of over 600 percent of active Internet traders from January to May, with 640 percent more transactions.
It was also the year that many state legislators and financial institutions around the world pointed out their increased cryptocurrency assistance. For instance, Japan enacted BTC as a legal type of payment, and Norway’s biggest online bank incorporated BTC accounts.
The cost grew steadily from $965 to $1316 between January and April. For the first time on May 21, BTC exceeded $2000, and from there it continued to gain traction.
The year ended at $13,313.
Coming to 2018, it proves to be an unstable year for Bitcoin. BTC began a fairly powerful year off at $14,112 and proceeded to a bull run that peaked at $17,462 on January 7. This peak is the largest price this year.
Bans on advertisements in 2018 also saw some interesting developments and affected the price. For instance, a complete ban on crypto advertisements was announced by Facebook on January 30.
Google announced on March 14 a ban on digital currency and ICO commercials and on March 26 a ban on Twitter. BTC price fell after all three announcements.
What Will be in Store for the Remainder of 2019?
In earlier months of 2019 BTC fell to as low as $4,500. Currently, the price of Bitcoin is growing, trying to find a stable level.
But with the most recent developments, regulations, the announcement of Libra and the nearing halving of the rewards for mining, the price will continue to fluctuate before another expected Bull Run.
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