🧘♂️ The Big Reveal
Summarised in a 5 minute read
Many people are new to the cryptocurrency space. If that’s you: welcome!
🏆 Others may have been around since 2017 and consider themselves OGs (Original Gangsters). But did you know, Bitcoin has actually existed since 2009? And the technology it is built on has roots going back even further!
Today’s Market Meditation shares a Brief History of Bitcoin. For those who don’t learn from history are doomed to repeat its mistakes.
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🗽 A Brief History of Bitcoin
1998 - 2008 🤕 A Sad, Sad World. With No Bitcoin
The world was a dark place without bitcoin.
Although, during this time, there had been previous attempts at creating online currencies with ledgers secured by encryption.
2 examples are B-Money and Bit Gold (formulated but never fully developed).
2008 🥷Enter The Man, The Myth, The Legend. Mr Nakamoto
A paper called Bitcoin - A Peer to Peer Electronic Cash System was posted to a mailing list discussion on crypto. The world was still recovering from the 2008 Financial Crisis, and the idea of decentralisation and not relying on Central Banks as intermediaries was especially appealing.
Author was Satoshi Nakamoto. Whose real identity remains a mystery to this day.
2009 🍕 Bitcoin is Born & The First Trade Is Made
In 2009, The Bitcoin software was made available to the public for the first time and mining began. The first ever Genesis Block was mined, awarding Satoshi the first 50 bitcoins of the 21 million that will ever be created.
Bitcoin wasn’t always traded. In fact, it was in 2010 that someone decided to sell theirs for the first time. Actually, they swapped 10,000 BTC for two pizzas! These pizzas set the first ‘real-life’ value for BTC at $0.0025 dollars.
2011 👯♀️ New Friends For BTC
As Bitcoin grew in popularity, the idea of decentralised and encrypted currencies caught on. Specifically, we saw altcoins emerge.
They tried to improve on the original BTC by offering greater speed, anonymity or some other advantage. Did you know some of the first altcoins to emerge were Namecoin and Litecoin?
2013 📉 The End of ‘Up Only’ As Bitcoin Crashes
Shortly after reaching $1,000 for the first time, the price quickly began to decline.
The FBI also seized $28.5 million in BTC from Ross Ulbricht, owner of Silk Road. Ulbricht gave a powerful video message from prison at this year’s Miami Conference.
Many lost money as the price plummeted to around $300. Talk about patience… it would be more than 2 years before BTC reached $1,000 again. People who have HODLed since pre-2013 are the definition of diamond hands.
2014 👾 Scams and Theft
In January 2014, the world’s largest Bitcoin exchange Mt.Gox went offline, and the owners of 850,000 Bitcoins never saw them again.
Fast forward 7 years and the lawsuits are ongoing. And unfortunately, scammers have only increased and become smarter. But so too have retail investors.
2016 - 2017 📱 Enter Ethereum, ICOs and The Pump
Ethereum’s 2016 arrival was marked by the emergence of Initial Coin Offerings (ICOs). Fundraising platforms which offer investors the chance to trade what are essentially shares in startup ventures.
Bitcoin dropped jaws as it climbed to $10,000 in November 2017 and $19,650 in mid-December 2017. ICOs were booming and everyone seemed to be talking about crypto. Any guesses what happened next?
2018 ⬇️ The Crash
Value of coins fell dramatically in the early months of 2018. A combination of uncertainty, fraud and a lack of belief amongst other psychological and technical factors. A “more mature market” arose.
2019 - 2020 ☄️ Born From The Ashes
From 2019 - 2020 prices began increasing and many people were excited about the future of Bitcoin.
This made the COVID induced 24-hour crash in mid-March all the more painful. We saw prices sharply drop from $8,000 to $4,500.
However, BTC showed great resilience. In May 2020 Bitcoin’s price was about $9,000.
2021 🏔 The Higher Up the Mountain, The Steeper The Fall
All the way until May 2021 we saw BTC thrive. Retail and institutional investors came through like never before. We reached all time highs above $63,000 ahead of the Coinbase debut.
The richest man in the world, Elon Musk, was a great ally until he announced his exit. Whilst analysts argue the market was already heated, after Musk’s statement the markets saw another crash.
We continue to find our feet again and longer term sentiment remains bullish. For instance, El Salvador made Bitcoin legal tender in June 2021. The first ever country to do so.
Looking through the history of Bitcoin, there is no shortage of lessons we can draw. However, there are two in particular we would like to emphasise:
Scammers Have Been Present For Years. They Aren’t Going Anywhere.
Security is and always will be essential. Your funds, your responsibility. Don’t wait another minute before you upgrade your defenses. For guidance check out our 9 Step Essential Security Guide 🔐
The Market Has Always Been Choppy. Be Prepared For Upside & Downside.
There’s a reason people who have been around in the space for longer are not as impacted (emotionally or financially) by market dips or corrections. It’s a healthy part of market cycles and the history of Bitcoin conveys that. And so, it becomes a case of ensuring you are prepared for inevitable corrections. We suggest:
Use stop losses to cap your downside. Check out our Stop Loss Video Guide 🛑
Be responsible with the amount of capital you risk. At the very least, you’ll want to establish and maintain an Emergency Fund 💰
Take advantage of more bearish market conditions. To learn how, read our Important Message To Crypto Investors 🐻
That concludes our brief history of Bitcoin. It’s up to you what you make of the future! We’ll be by your side. Sharing analysis, insights and updates. Let’s do this.
Not financial or tax advice. The content in this newsletter is for informational purposes only. Nothing in this email is intended to serve as financial advice. We are not financial advisors. Every investment and trading move involves risk. Do your own research when making a decision. See our important security disclaimers here.
Disclosure. Some of the links we’ve included are affiliate, they give you rewards and discounts and earn us a commission. Additionally, the Market Meditator writers hold crypto assets. See our investment disclosures here.