It’s Mike Aromday with you again today. In this video, I will tell you a short story about Bitcoin. I’ll just explain the most important and interesting things about Bitcoin, so you can better understand the cryptocurrency world. Let’s go.
How was Bitcoin born
World recession, European debt crisis, other financial crises. All of these things have shaken our confidence in the government and the ways in which it handles financials. This global storm has become an ideal cradle for the birth of a new cryptocurrency—Bitcoin.
Since the creation of the Internet, there have been multiple attempts to create virtual money, but they couldn’t solve the double spending problem. The concept of double spending is that virtual money is just information and their digital key can be copied and used repeatedly. The way to solve this problem is to check the quality of the digital-key via a trusted source, but if there is only one source, then it can be hacked, which negates the only trusted source.
2008 sparked innovation. Bitcoin bypassed this problem with a chain of blocks, where each transaction is confirmed by an extensive centralized network of computers.
In August 2008, bitcoin.org was registered.
October 2008 – the design of Bitcoin was approved. The creator of Bitcoin was announced as Satoshi Nakamoto, which was most likely a pseudonym. No one knows who is behind this pseudonym, although there have been many assumptions. It is only known that ‘Satoshi Nakamoto’ means “clearly thinking within the system” in Japanese. In Japan, Satoshi is an unknown genius of mathematics, well versed in cryptography. Satoshi made the last changes in the code in mid-2010, after that he handed over the reins to Gavin Andersen, the lead developer of Bitcoin.
In January 2009, the Bitcoin network started working on the release of the first open source Bitcoin client and issuing the first Bitcoins. Satoshi Nakamoto mined the first block of Bitcoins with a nominal value of 50 BTC. Better known as the genesis block. The first transaction was conducted successfully from Satoshi Nakamoto to Halu Fini.
In October 2009, the rate for 1.30903BTC equated to 1 dollar as a standard according to the New Liberty Standard.
In May 2010, the first Bitcoins were sold at a rate 1.000BTC for 0.0003 dollars. Laszlo Hanich, a programmer from Florida, made the world’s first real Bitcoin transaction when he used 10,000 Bitcoins to order two pizzas.
In July 2010, the largest and most famous Bitcoin exchange—MT.GOX—began its work. Funny fact: MT.GOX firstly opened in order to trade cards for a board game titled Magic: The Gathering.
In August 2010, they found a large vulnerability in the Bitcoin protocol. On August 6, transactions were not checked before the block chain was included in the log and that allowed users to create an unlimited number of Bitcoins. On August 15, the vulnerability was applied, and more than 184 billion bitcoins were transferred in one transaction. An hour later, the transaction was found and was deleted from the blockchain log. It was the only major vulnerability found and applied in the entire history of Bitcoin.
In November 2010, the total volume of Bitcoin reached one million US dollars.
By 2011, everybody was already aware of Bitcoin.
In February 2011, Bitcoin equated to a dollar.
In April 2011, Forbes magazine published an article about Bitcoin called “Cryptocurrency”.
In June 2011, Wikileaks started to accept donations in Bitcoin, and Bitcoin’s market capitalization reached $ 206 million. Gawker then published a story about ‘silk road’, a site selling illegal goods for Bitcoin. At the same time, a table containing 60 thousand logins, e-mail addresses, hashes, and passwords leaked from MT.GOX exchange. Many users who studied the MT.GOX database used the same data for MyBitcoin—a popular Bitcoin wallet, and cracked many passwords. This resulted in 600 users losing their money. MT.GOX, the largest Bitcoin exchange, which made 90% of exchange transactions, conceded information leakage. Later, someone got hold of administrative access and placed hundreds of thousands applications for the sale of fake Bitcoins, forcing the prices on MT.GOX to temporarily fall from $ 17.51 to $ 0.01. MT.GOX announced that these transactions will be reviewed, and trade stopped for 7 days.
The was a restoration of trust in the cryptocurrency in 2012. After the 2011 hacks, Bitcoin restored user confidence for almost a year. The first Bitcoin store was opened, the first music album was sold for Bitcoin, and the first litigation due to Bitcoin happened. Bitcoins was used as a credit default swap, for the first time it was told about Bitcoin was explained in schools. Then, the first car was sold for Bitcoin, the first hospital accepted Bitcoin, the first taxi accepted Bitcoin and the first biggest site began to accept Bitcoin.
In October 2012, the European Central Bank became compelled to reckon with Bitcoin. “… virtual currencies can have a negative impact on the reputation of central banks if their use increases significantly. This risk should be taken into account when assessing the overall risk situation of central banks.
In November 2012, Bitcoin celebrated the first “double day”. Once every 4 years, the reward for mining a new unit is doubled.
In 2013, it was a promising future. In February 2013, one bitcoin cost more than one ounce of silver. Also, the social news site Reddit began to receive Bitcoin.
In March 2013, Capitalization had reached one billion dollars. In the same month, an error in a chain of blocks on different computers with different versions of Bitcoin wallets occurred. As a result, they didn’t recognize each other’s blocks as active. This created a transaction split in the journal and allowed users to use the same money for two different purposes. MT.GOX temporarily froze the funds in Bitcoin and prices dropped from 23% to 37%. The split was quickly eliminated and the price was quickly restored. Meanwhile, Cyprus announced bank holidays and decided to withdraw some money from customer funds. Against this background, the price of Bitcoin soared and in April, it cost $ 200.
In May 2013, the US froze MT.GOX accounts and they discovered that MT.GOX was not registered by the Ministry of Finance as a currency exchanger.
In October 2013, the FBI shut down ‘silk road’ and arrested the CEO, accusing him of murder and drug trafficking. As a result, the price of Bitcoin fell, but it soon restored. Then it became known that the FBI froze 26, 000 BTC, which belonged to the silk road founder. Meanwhile, Vancouver in Canada, opened the world’s first Bitcoin ATM.
In November 2013, the Federal Reserve System Chairman Ben Bernanke sent a letter to the US Senate, in which he wrote that the Federal Reserve System didn’t have the right to control cryptocurrency. Letter quote: “We must adhere to a positive policy about innovations that contribute to faster, safer and more efficient money circulation.” At the same time, Virgin Galactic announced acceptance for payments in Bitcoin for space travel. Meanwhile, Bitcoin overcame the $1,000 mark and temporarily cost more than one ounce of gold. One Bitcoin costs more than 300 thousand times more than it used to cost in 2010.
In early December 2013, the People’s Bank of China announced that it prohibits the use Bitcoin. The price of Bitcoin fell to $600, but then recovered to $900-1000.
Present time – Bitcoin in 2018 year.
From 2016 to 2018, Bitcoin became very popular and it is now used in many countries and many people love it. With Bitcoin, you can pay for different kind of goods and services in many places, including Thailand! In Bangkok, it is possible to find a Bitcoin ATM in the Nonthaburi area, Ko Kret Island or in the center of the city—Rama 9 RCA. Some of the cafes and restaurants in the Asok and Sukhumvit area of Bangkok accepts Bitcoin as payment. Also Bitcoin or other cryptocurrencies can be when buying or selling on Thai online exchange sites, for example BX IN TH.
In December 2017, the maximum cost of Bitcoin reached 1$8,738 – $612 000 Thai baht.
In January 2018, the price of Bitcoin went down to $17 109 dollars – 559 500 Thai baht. After that, the price fell even more but sometimes the price does go up.
On the 7th of November, 2018, the price of Bitcoin was approximately $6541 – 214000 Thai baht.
When it came to the 25th of November, 2018, the cost of Bitcoin dropped down ~$3601 – 117 000 Thai baht. And now Bitcoin is going through a correcting stage and it’s starting to grow once more.
Despite attempts by some countries, including Russia, to curb the spread of cryptocurrency, due to the lack of control and understanding surrounding Bitcoin as well as the fact that it was involved in several incidents, the capitalization of cryptocurrency is still growing steadily. The confidence in cryptocurrency has not fallen. And leading companies, specialized in virtual currency trading, have stated that they are coordinating their efforts to spread Bitcoin and are not going to abandon it. Over the past five years, Bitcoin has gone from an experiment to a full-fledged currency with a market capitalization of billions of dollars.
The future is unknown so far, but one thing is certain: Bitcoin will continue to destroy the people’s conceptions surrounding government and money.
Well, that was our video about the history of Bitcoin. I hope that you liked it. I’ll see you in our next video.