Bitcoin: A Brief History and a Peek Into the Future

Bitcoin: The inception

An anonymous entity, Satoshi Nakamoto, published a whitepaper entitled “Bitcoin: A Peer-to-Peer Electronic Cash System” in 2008 to counter the Global Financial Crisis (GFC) that fueled inflation and adversely affected the economy in the early 21st century.

A few months later, on January 3, 2009, the first-ever block was mined on the Bitcoin network. It is called Block 0. It is also known as the “genesis block” and contains “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks,” which is proof that the block was mined on or after that date.

The first-ever Bitcoin transaction (The Genesis Block)

Satoshi Nakamoto, the anonymous founder of Bitcoin, transferred 10 BTC to Hal Finney, a computer scientist, on January 12, 2009. Finney became one of the few pioneers to embrace Bitcoin and mine the asset.

Hal Finney is also believed to be among the very few people who have communicated with Satoshi.

“Today, Satoshi’s true identity has become a mystery. But at the time, I thought I was dealing with a young man of Japanese ancestry who was very smart and sincere. I’ve had the good fortune to know many brilliant people over the course of my life, so I recognize the signs.”
– Hal Finney, an early Bitcoin adopter, and pioneer

Sadly, in 2009, Finney was diagnosed with ALS and was paralyzed. However, he was at peace with his involvement in the Bitcoin project and was curious to see how his Bitcoins would help his family. He remarks, “My bitcoins are stored in our safe deposit box, and my son and daughter are tech savvy. I think they’re safe enough. I’m comfortable with my legacy.”

The first-ever real-world Bitcoin transaction

May 22, 2010, is one of the most important days in the history of Bitcoin. On this day, Laszlo Hanyecz, a developer and an early Bitcoin miner, exchanged Bitcoin to purchase physical goods. He wanted two large pizzas for a whopping 10,000 BTC. This was when Bitcoin’s price was a little less than half a cent per coin.

After waiting a few days, his request was fulfilled by another user Jeremy Sturdivant, who went by the username “jercos” on Bitcointalk.org. If he had held the Bitcoins until the currency reached its all-time high of $68,990 in 2021, they would be worth $690 million today. That amount of cash could buy him 46 million large Papa John’s pizzas at $15 a piece.

Bitcoin: an alternate to banks?

During the Global Financial Crisis in 2008 and 2009, a lot of banks and financial institutions failed, which affected millions of people worldwide. It was one of the worst financial crises of the decade that swept away $2 trillion from the global economy.

The 2008 financial crisis unearthed the hidden vulnerabilities of our financial system. People realized they needed a currency they could trust, money that could not be inflated or controlled by a central authority.

Bitcoin was conceptualized to break financial barriers, bank the unbanked, eliminate dictatorship and prevent inflation. Today, there are over 44 million Bitcoin users worldwide, transacting over 400,000 times a day on average.

Here’s how Bitcoin solves existing problems with banks and other financial institutions:

• Bitcoin is completely decentralized & free from dictatorship. Thus, it cannot be controlled by a single entity or person. No one can inflate it or print it at will. Bitcoin is programmed such that it is autogenerated through software, and there will be, in total, only 21 million coins in existence.
• Bitcoin is fraud-proof and cannot be frozen/stolen away. Payments made via Bitcoin are peer-to-peer — eliminating all the intermediaries from a transaction. Thus, no one can freeze your funds or impose any restrictions on its use.
• Bitcoins are accessible to anyone, anywhere, 24×7. On the contrary, you cannot use banking services over weekends or public holidays. Moreover, in a few remote areas, there are no banks at all — keeping a lot of citizens unbanked.
• Transferring Bitcoin anywhere in the world is fast, simple, and cost-effective. While international bank transfers can take an eternity and cost you a fortune, Bitcoins can be transferred anywhere around the globe almost instantly.
• Banks and other institutions can be hacked and exploited by malicious attackers. However, crypto is safe and secure as it cannot be tempered without your private keys.
• Banking charges are overwhelming and oftentimes unpredictable. Not everyone can afford the account maintenance fees, overdraft charges, and other expenses imposed by banks. With Bitcoin, all you pay is a nominal network fee, which is a tiny fraction of the total transaction amount. No other fees/additional charges.
• Banks can be biased towards a particular individual or a group of people. For instance, if you have indifferences with a financial officer from a certain bank, he may delay your transactions or raise false claims. This makes them unreliable and untrustworthy.

Bitcoin holds tremendous potential and can be an ideal alternative to banks. Several countries like El Salvador and the Central African Republic (CAR) have adopted Bitcoin as a legal tender. More countries are soon to follow the trend as banks around the world are becoming increasingly unstable.

The future of Bitcoin

Being the oldest, largest, and most mature cryptocurrency, Bitcoin holds tremendous potential to be the next best alternative to banks. Its wide accessibility, global acceptance, and ability to store value make it an ideal currency for the future. In the last three years, Bitcoin’s price has tripled, and it has grown by 1,500% in six years. It’s the only currency that holds half the value of the entire crypto market.

Final words

Bitcoin’s future is uncertain. It can either be an alternative to banks and a dominant currency or disappear entirely.

In the near future, cryptocurrencies will be more than just an investment. They have the potential to reach where money can’t. They are already used across diverse industries, from eCommerce to entertainment and everything in between.

Having said that, Bitcoin has tremendous potential to transform the way money works. If you are seeking to start using Bitcoin for your day-to-day transactions, sign up with Speed Wallet today.

Merchants and businesses can start accepting Bitcoins across their online and offline touchpoints. Sign up for a merchant account to start using Speed Solutions commercially.