Bitcoin's volatility has been extremely high since early 2022. To a person who is not familiar with the cryptocurrency industry, such volatility can seem dangerous. However, it is a common story for bitcoin to surprise investors even when no one expects it. In this article, we will remember the main ups and downs of the asset and trace the dynamics of bitcoin from its inception in 2008 to the present day.

Bitcoin price history

Bitcoin's history actually began in August 2008, when the domain name bitcoin.org was registered. Later that year, someone under the pseudonym Satoshi Nakamoto published a document titled "Bitcoin: An Electronic Peer-to-Peer Payment System. In it he described how the future cryptocurrency would work.

In 2009, cryptocurrency mining began. However, bitcoin was not sold anywhere. At that time, there were no cryptocurrency exchanges at all. Technically, the price of bitcoin in 2009 was $0.

Bitcoin price by year

2010

During the whole year of 2010, bitcoin never reached the $1 level, but the price began to grow. The most amusing event of that year was the moment, when American Laszlo Hanech bought two pizzas for 10,000 BTC (1 BTC cost $0.0025 at that time). If Laszlo had kept this amount of bitcoins for another 10 years, he would have more than $450 million in 2021.

Also in 2010, there was the infamous Mt.Gox cryptocurrency site, which would later become a target for hackers.

2011

The year 2011 was a turning point for BTC: in our history of bitcoin by year, it occupies an almost more prominent place than the record-breaking year of 2017. First, bitcoin finally managed to reach the $1 mark. After highly specialized publications Slashdot and Hacker News wrote about the cryptocurrency, Bitcoin.org received a wave of new users from Twitter.

At the beginning of 2011, unusual events occurred: from February 25 to February 27, the bitcoin network's hash rate increased sharply from 401 gpd to 628 gpd. The hash rate then declined to 392 gpd until March 1, and then rose to a record 774 gpd.

Such a sharp jump could be explained by the fact that someone was using a supercomputer or a certain network bot, which would later be referred to in the cryptocurrency community as a "mystery miner. This "mystery miner" became the reporting point of a gradual increase in the bitcoin network's hash rate, and since June, it "exploded" the network to an unthinkable 15.8 terahashes per second.

On April 16, 2011, TIME magazine first mentioned bitcoin, devoting an entire article to it with the headline "Bitcoin Online Money May Challenge Governments and Banks. In early June of that year, after the cryptocurrency appeared in the media, the price of bitcoin soared to nearly $32 in six days, but then dropped to $10.

In the same month, the well-known resource WikiLeaks began accepting donations in bitcoins.

On June 19, 2011, Mt.Gox was hacked, triggering a drop in the price of bitcoin from $17 to $0.01. It affected the accounts of 60,000 users for a total of more than $8.7 million. A week later, trading on Mt.Gox recovered, and the price drop after the hack was the largest in the history of bitcoin.

2012

By 2012, the bitcoin price had fallen to $4.6, but recovered to $13.44 within a year. That same year saw the first ever bitcoin halving.

2013

Bitcoin reached the $1,000 mark in 2013. On November 30, 2013, the price of bitcoin rose to its first serious high of $1,153. It repeated it only a few years later - on January 5, 2017.

2014 и 2015

After a great year for the cryptocurrency industry in 2013, there was a climactic event in the criminal history of bitcoin. In February 2014, Mt.Gox was hacked again, this time stealing 744 thousand bitcoins. This is an absolute record and the largest hack of an exchange to date.

As a result of the hack, Mt.Gox declared bankruptcy and shut down, creating panic in the bitcoin market. From that moment on, the first prolonged bitcoin decline, which is commonly referred to as the "cryptocurrency winter," began.

2016

2016 was marked by another hacking, the first hack of Bitfinex for 120 thousand bitcoins, and the emergence of Craig Wright, who proclaimed himself Satoshi Nakamoto. By the way, Wright is still suing the developers of Bitcoin Core and Bitcoin Cash, who deprived him of access to two cryptocurrencies as a result of the Mt.Gox hack.

2017

A watershed year in the history of bitcoin. At the beginning of 2017, bitcoin was still worth $960, in September it passed the $5,000 mark, and on December 17, bitcoin peaked at $19,483. Bitcoin's market capitalization exceeded $330 billion that year.

2018

At the beginning of the year, bitcoin was worth around $13,800 - and that's the maximum price per coin. By the end of the year, it was trading at around $3,800. This year was remembered for the collapse of the cryptocurrency and another cryptocurrency winter. On January 17, 2018, the coin fell to $9800. On January 30, Facebook, Twitter and Google banned cryptocurrency advertising, ICOs and binary options on their platforms. After that, the price of bitcoin continued to fall.

In the summer of that year, Facebook reconsidered its attitude to the ban on cryptocurrency advertising and allowed it, but after moderation. However, this did not help the coin market to recover in price

By the end of 2018, bitcoin had fallen by almost 80% compared to the same period in 2017. Miners were selling their businesses en masse as they were making losses.

2019

In June 2019, bitcoin tried to overcome a bearish crisis, but failed to overcome resistance at the $13,785 level. The main topic in the community was legal issues, the SEC's fight against bitcoin-ETFs, and hopes for the launch of the institutional bitcoin service Bakkt.

Bakkt finally launched in September, but didn't attract much attention among institutional investors, triggering a drop from $10,036 to $6,657 in just a couple of months.

2020

The year 2020 allowed cryptocurrencies to first stabilize and then begin to grow, despite the serious economic crisis around the world related to the coronavirus. Bitcoin and other cryptocurrencies seemed to go against all traditional assets and rose when markets fell.

In January, bitcoin was trading at $7.2 thousand, in February at $10.5 thousand, but then a sharp drop to $3.8 thousand followed. During the year, the price rose and in December 2020, the coin was worth around $19 thousand.

There were several reasons for bitcoin's strong growth. First, the money supply of the U.S. dollar increased by 22%. And since business activity has declined a lot because of the coronavirus, this has led to a devaluation of the currency.

Against this background, institutional investors began to invest in bitcoin. For example, Ruffer invested 2.5% of its assets in the coin. The British investment fund said in a letter to its investors that the move was needed as insurance against devaluation of global fiat currencies.

In 2020, one of the largest payment systems, PayPal, allowed its platform to use cryptocurrencies for payments. This decision was met with huge demand, and the company had to increase the limit on transactions several times.

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