2024-01-03 01:33:05
From the panic that cybercriminals had free rein to act with it to becoming legal tender in El Salvador. Bitcoin celebrates 15 years of history marked by a rollercoaster of volatility that has made some millionaires, but has also managed to completely ruin many others.
Far from its initial objective of becoming a massive means of payment, the most popular cryptocurrency in the world resists as an investment alternative for individuals, putting in check supervisors around the world who are now accelerating to finally provide a regulatory framework. stable to this market.
The first bitcoin was actually born at the end of 2008, but it was a few months later, in 2009, when Satoshi Nakamoto (alias used by its creator) mined the first block of the cryptocurrency, generating the first transaction between himself and the computer programmer. Hal Finney, who became the first recipient of a peer-to-peer operation (a network of computers that allow information to be exchanged between them directly) of this network.
Two pizzas, 10,000 bitcoins
Programmer Laszlo Hanyecz makes his mark in ‘crypto’ history by making the first purchase of a tangible good with bitcoins. Specifically, he paid for two Papa John’s pizzas for 10,000 bitcoins. At that time, when the value of ‘crypto’ was very low and there were hardly any movements in the market, the cost was equivalent to about $40. Today, those 10,000 bitcoins would be worth more than $390 million.
After a blockade of the cryptocurrency by the electronic payment processors Visa, MasterCard and Paypal, on June 14, 2011 Wikileaks begins to accept bitcoins. That year was also the year of the beginning of a greater volume of transactions, with the first major price jump through which, for the first time in its history, bitcoin reached parity with the dollar (1 bitcoin = 1 dollar).
The Coinbase revolution
In October 2012, the largest digital currency exchange platform, Coinbase, was born with the launch of the first service to buy and sell bitcoins through bank transfers. The company, based in San Francisco, California, is currently the leader in its segment, ahead of other giants such as Binance.
The Central Bank of China prohibits financial institutions from channeling operations in Bitcoin, causing the collapse of the cryptocurrency that, in just a few days, went from being worth $1,200 to $690, a 45% drop. It took almost three years, until 2017, for the ‘crypto’ to recover those levels.
In a bad year for the price of cryptocurrencies, companies like Microsoft are beginning to accept payments in bitcoin for the purchase of video games, some applications and software.
The State of New York launches the so-called BitLicense in an attempt to regulate market players in some way. Specifically, the rule required entities with businesses based on digital currencies to obtain a prior and specific business license in order to operate.
In August 2016, Bitfinex, one of the main cryptocurrency exchanges based in Hong Kong, was hacked with the theft of 120,000 bitcoins, which at the time were worth about $60 million, revealing that the digital market can also entail financial risks.
The Financial Services Agency of Japan (FSA) gave a giant boost to the market by becoming the first country to recognize (not implement) bitcoin as a means of payment. It was the first time that the cryptocurrency exceeded $5,000 and that year was one of the best in terms of profitability.
Supervisors Alert
Volatility dominated this exercise for Bitcoin, which in February lost half its value in just two weeks, ruining many investors. At that time, the Bank of Spain and the National Securities Market Commission (CNMV) were forced to launch a joint statement to warn of the risk of these investments due to their complexity and lack of transparency. The supervisors recalled that no cryptocurrency had been registered, authorized or verified by any supervisor in Spain, so they could not benefit from the guarantees or protection provided by the regulations relating to banking or investment products.
That year there was one of the great milestones that shook the cryptocurrency market. The social media giant Facebook announced the creation of its own ‘crypto’ Libra, backed by brands as powerful as Visa, Mastercard or Paypal. The idea was to convert it into a means of payment on the platform. Just three years later, in 2022, Mark Zuckerberg’s company decided to abandon its plans.
Despite appreciating strongly throughout the year, bitcoin experienced many episodes of strong and prolonged falls in 2019, generated mainly by the forecast of greater competition in which central banks also had a lot to do with, with advances in their plans for the creation of their own digital currencies.
It was one of the great years for bitcoin. The outbreak of the coronavirus pandemic triggered the purchase of cryptocurrencies during confinement and in the following months, with strong growth in the use of digital wallets to store cryptocurrencies, while there is an improvement in expectations about the use of this currency digital. According to data collected by Funcas, only in July of that year the ten most important ‘crypto-wallets’ (among them Coinbase, Crypto.com or Binance) increased installations among clients by around 81.5% compared to the previous year.
The currency revalued strongly, even taking into account that that year the so-called ‘halving’ occurred, a technical adjustment by which the reward for mining bitcoins was reduced by half (in May it went from 12.5 bitcoins per block mined at 6.25).
The impact of Tesla and El Salvador
Tesla confirms that it would begin to accept bitcoins as a means of payment for its vehicles and the price of the ‘crypto’ soared above $44,000 on the day of the announcement. But, everything that goes up, comes down. And even more so in such an extremely volatile market. So when Elon Musk’s company announced shortly after that it was reversing its decision, the value of bitcoin plummeted again.
2021 will also go down in history as the year in which El Salvador became the first country to accept bitcoins as legal tender. In that year, the cryptocurrency surpassed $66,000, its maximum so far, although it closed below that value (at $46,200).
The collapse of ‘crypto winter’
In 2022, the largest earthquake in living memory occurred in the crypto world, whose total market value fell by half in just a few months. It all started in May with the sudden collapse of Terra Luna, one of the most popular ‘stablecoins’ on the market and which, in just 24 hours, caused losses of more than $200 billion to the market.
Shortly after, the bankruptcy of FTX would arrive, which caused a cascade of bankruptcies, among others that of the Génesis firm, which left thousands of people trapped who saw how the value of their investments evaporated overnight.
The situation served at least for Europe to accelerate its objectives to regulate a market that that year was described by the European Central Bank (ECB) as a true “Wild West.”
After a disastrous year for crypto assets, bitcoin is reborn from its ashes with a revaluation of 130% in 2023, above $37,885. The fear of recession turned the digital currency into a refuge value for investors, who also positioned themselves in the heat of the end of interest rate increases by central banks.
The future lies in regulation
Looking to 2024, the forecasts remain positive. But the rebirth of bitcoin in the last 12 months inevitably involves greater regulation and a more stable legal framework. In Europe, the MiCA Regulation has already been launched, a historic and pioneering standard at a global level to regulate cryptoassets from a holistic perspective that, in the case of Spain, will be one hundred percent implemented in December 2025, according to the forecasts of the Government.
The objective of the standard is to monitor the path in which what is now only a speculative investment can become a transparent and reliable means of payment capable of competing with cash or the digital currencies themselves that the main central banks are already preparing. in the world, like the digital euro.
With this scenario, MiCA will force issuers (those who create cryptocurrencies), exchange platforms such as Binance, Coinbase, etc., or firms that manage wallets (the so-called wallets) to meet strict requirements to be registered and obtain a license. that allows them to operate. The Treasury will also be very much on top of the operations… and of the investors themselves in bitcoins and other cryptocurrencies.
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