Bitcoin Turns 12: From the Genesis Block to the Adoption of Wall Street
Bitcoin Turns 12: From Genesis Block to Wall Street Adoption
The Bitcoin network as we know it today was officially launched exactly 12 years ago, when Satoshi Nakamoto launched the first software client.
Satoshi Nakamoto, the unknown creator of Bitcoin, launched the first client network on this day 12 years ago, officially launching what is perhaps the greatest money revolution of the 21st century.
Six days earlier, on January 3, 2009, Satoshi undermined the Genesis Block, known as #0, by encoding it into the software. Unlike subsequent blocks in the chain, the Genesis Block’s reward in the form of coins cannot be spent, as only publicly mined “coins” can be transferred. So the first block, or #1, was mined on January 9th, giving a real start to the network as it is known today.
At that time, Satoshi announced the news to the cryptography mailing list with a download link to Bitcoin 0.1.0 on the free software database platform Sourceforge.
Bitcoin 0.1.0 was only compatible with the Windows operating system. The first client version with Linux support didn’t arrive until December 2009 with the release of Bitcoin 0.2.0.
Silk Road and the expansion of mining by 2011, Bitcoin seemed to be evolving from being a strictly cybernetic affair to being the realm of anarchists and free marketers.
Silk Road, the now extinct Darknet market, made its appearance with BTC as a popular payment method for illegal drugs and other prohibited substances.
On the market side, Bitcoin reached the milestone of a dollar price when attention began to spread to the wider technology community. In mid-2011, Bitcoin was at $30, but a 25,000 BTC theft from a user’s slushpool account caused a huge price drop.
Bitcoin mining was also evolving, and personal computers could no longer provide enough hash power to secure the expanded network. Graphics processing units and field-programmable gate arrays now provided more efficient Bitcoin mining capabilities.
In 2010, Stellar founder Jed McCaleb established the Bitcoin Mt. Fast forwarding to 2013, the platform handled more than 70% of BTC’s worldwide trading. Mt. Gox seemed too big to fail, but it did, in fact, when hackers stole about 850,000 BTCs between 2011 and 2014. The news of the thefts caused another big drop in Bitcoin’s price.
Meanwhile, the adoption of the technology was increasing, leading to the appearance of products such as BTC storage devices by people like Elliptic. The giant US cryptomoney exchange Coinbase also came into play, raising $25 million in funds.
On the regulatory side, the period between 2013 and 2014 marked the beginning of several governments looking to Bitcoin. China’s central bank prohibited banks from facilitating BTC transactions, while the U.S. government auctioned off some 29,000 BTCs seized from Silk Road operators.
By 2015, major altcoin projects like Ethereum had begun to emerge, as the founders sought to create digital coins with features designed to fix perceived defects in the Bitcoin protocol. Mining also went a step further with the introduction of application-specific integrated circuits and the increase of Bitcoin industrial mining.
The failure to reach consensus on the block size limit led to a split in the chain in August 2017, which led to the creation of Bitcoin Cash (BCH). However, the real prominence came when the price of Bitcoin grew almost 20 times from January 2017 to mid-December, almost eclipsing the $20,000 mark.
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 substantial and prolonged decline that reached a bottom of $3,800 in early 2018. The bear market lasted the rest of the year, with several proponents advocating institutional adoption as the next step in Bitcoin’s evolution.
Although Bitcoin was in the midst of a bear market, its fundamentals continued to improve. By mid-2019, the network’s hash rate had surpassed 70 exahashes per second, more than 10 times the number of grains of sand on the planet. Bitcoin derivatives also took off, introducing markets such as futures and options contracts, and major companies like Fidelity announced plans for Bitcoin custody solutions.
By 2020, Bitcoin seemed to have become the favorite of institutional investors, with hedge funds and companies pursuing direct exposure to BTC. Some publicly traded companies have even added Bitcoin to their balance sheets, maintaining the best market-capitalization-rated cryptomone as a treasury reserve asset amid recurring currency devaluation policies in major economies.
Bitcoin passed the $20,000 mark in late 2020 but didn’t stop there. Successive reports from the main companies that bought BTC saw the price enter another parabolic trajectory advance, despite falling by 50% in the first quarter of 2020 during the initial sale of assets by COVID-19.