It’s estimated that around 100 million people in the world use Bitcoin.
Yet what’s so fascinating is that, even though the number of Bitcoin users is growing, there are still many out there who really have no idea what Bitcoin is.
Even people who use Bitcoin are still mystified by this cryptocurrency’s history.
When was Bitcoin created? And who actually started it?
These are questions with surprisingly elusive and interesting answers. But for those who want to get more involved with cryptocurrency, it’s worth knowing about the background of Bitcoin and how it came to be.
Interested in learning more?
Continue reading and we’ll walk you through everything you need to know about the history of Bitcoin.
Before we actually get into when Bitcoin was created, let’s first give some backstory.
The real history of Bitcoin can be said to have started way back in 1982.
In this year, David Chaum, a computer scientist, proposed a concept called e-Cash. Seeing the possibilities that computers brought, Chaum was already concerned about digital privacy.
He published a paper proposing a new type of cryptography where an automated payment system could exist. In this system, third parties wouldn’t be able to see information about the payment.
In 1990, Chaum created DigiCash. The goal was to create an online currency that was both secure and safe.
Unfortunately, DigiCash never really caught on and the project was disbanded in the late 1990s.
Despite DigiCash’s failure, other computer scientists became increasingly interested in the concept of digital currency. Over the years, various people tried and failed to make their own cryptocurrencies.
Then, unbeknownst to most of the world, on August 18, 2008, the domain name “bitcoin.com” was registered.
A few weeks later, on October 31, 2008, the world as we know it would be changed forever.
On that day, a link to a paper with the title Bitcoin: A Peer-to-Peer Electronic Cash System, was uploaded to a cryptography mailing list.
In January of the following year, the bitcoin software was implemented and released as open-source code.
The bitcoin network was created on January 3, 2009, when the first block of the chain was mined.
This was called the genesis block. Embedded in the coinbase of that block was a text alluding to a British news headline from that day referring to bank bailouts.
A cypherpunk by the name of Hal Finney was the first person to receive a bitcoin transaction. Finney downloaded the software for bitcoin when it was released and on January 12, 2009, he received ten bitcoins. The first commercial transaction with bitcoin was executed in 2010 when a programmer bought two pizzas from Papa John’s for ₿10,000.
Perhaps the most mystifying and strange thing about Bitcoin is figuring out who created it. The true identity of the creator of Bitcoin is still a mystery. However, we do know that they go by the name Satoshi Nakamoto and are said to be of Japanese nationality.
Hardly any personal details about Nakamoto are known. In 2012, he claimed on his P2P Foundation profile, that he was a 37-year-old man who lived in Japan. However, many people doubt this to be true.
Nakamoto seems to have a native-level grasp of the English language and his software isn’t written in Japanese. Many suspect that Nakamoto isn’t just one person but a group of programmers.
Nakamoto also uses British English in his forum postings and source code comments. He uses expressions like “bloody hard” and spellings like “colour” and “grey”. The fact that he used a headline from a British newspaper also suggests that he may be from the UK.
Some coders also checked into the time stamps for when Nakamoto would post to his forum. He almost always posted in the middle of the day British time, which would be in the middle of the night if he lived in Japan.
When the price of Bitcoin peaked in December of 2017, Nakamoto’s net worth was worth billions and he was one of the top 50 richest people in the world.
The main reason why Bitcoin was created was so that people could transfer and store money in a secure way. Bitcoin is essentially a payment and banking system with enhanced privacy.
With bitcoin, nobody can:
Bitcoin uses a shared common ledger which can’t be manipulated by dishonest people. Transactions in the ledger can’t be falsified or changed. Ever.
For the first few years of Bitcoins, the value of a single Bitcoin was equivalent to a couple of US dollars. The cryptocurrency really started to take off in 2013, though. That year, one bitcoin was worth over $200.
In December of 2017, the price surged and one Bitcoin was worth nearly $20,000! Many critics called this a price bubble and claimed it couldn’t be sustained. They were correct, and, one year later, the value of a Bitcoin dropped to around $3,500.
Today, Bitcoin continues to rise and fall and generally bounces between $5,000 and $10,000 per coin.
Bitcoin is a tool that everyone should familiarize themselves with. While many people think they need to be stuck with our current currency system and its many flaws and manipulations, that’s not actually the case. And by knowing the answer to the question “when was Bitcoin created?”, as well as its whole history, we can gain a new appreciation for this cryptocurrency.