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" Bitcoin story"

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Avatar for Jeth-jeth
Written by   39
3 weeks ago

Bitcoin’s story is one of the most interesting ones.

If Bitcoin survives, which I think it will. The Bitcoin story will be the most told one in years to come.

When I first encountered Bitcoin and got to the roots of its origin it was almost unbelievable. It was unreal.

That’s why people find it hard to believe and most of the time label it as a scam. But it isn’t.

It was after the financial crisis of 08–09 only that the world got to know about Bitcoin through Satoshi Nakamoto’s email.

Satoshi is the anonymous founder of Bitcoin. It is believed it is an individual or a group of people behind it.

Bitcoin’s launch during the 08' financial crisis was not coincidental. Satoshi had been coding Bitcoin for the last 2 years.

Let’s look at the sequence of events in 2008:

Jan - July: Fed tries to stop the housing bust: Fed bails out Bear Sterns. Paulson explains the need to bail out Fannie Mae, Freddie Mac the two agencies that held or guarantee 50% of the $12T in US mortgages.

Aug 18: Satoshi registers 

Sept 15: Lehman Brothers files for bankruptcy, the largest in U.S. history ($600B)

Sept 17: Investors withdrew a record $144B from their money market accounts. During a typical week, only about $7B is withdrawn.

Oct 3: Bitcoin whitepaper PDF likely created

Oct 13: Treasury Secretary Paulson talks with 9 major bank CEOs. The total bailout package ~$2.25T

Oct 21:  Fed lends $540B to bail out money market funds

Oct 31: Satoshi publishes the Bitcoin whitepaper.

With the 2008 financial crisis, the trust had been lost in a world that ran on trust. Bitcoin was launched in a time of absolute necessity, Satoshi planted the seed at precisely the right moment to create an alternative for general masses that existed outside the traditional financial system.


This becomes more clear when you see Satoshi’s embedded message on the  where he said this:



Later in 2019, Satoshi Nakamoto, the creator of Bitcoin, mined the first Bitcoin block on 3rd January 2009 and started the P2P digital cash system after completing the code.

For this, he had to code in the logic for the Genesis block, and he eventually mined it, starting of the great historically ledger of Bitcoin.

Unlike these days the mining difficulty was very low at that time, and that’s it was possible to mine BTCs even with a CPU.

The first transaction of 50 BTC went to this address (1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa) which Satoshi controlled and later on 12th January 2009 Hal Finney- another pioneer cryptographer started running the Bitcoin software.

Hal Finney received first 10 BTC from Satoshi after which he continued running the software and reporting back to Satoshi on emails as Satoshi was fixing bugs.


You can look at the transaction here:f4184fc596403b9d638783cf57adfe4c75c605f6356fbc91338530e9831e9e16

Hal was particularly ecstatic about Bitcoin, and this was evident from his description overall involvement with Bitcoin in its early days, where he said:

When Satoshi announced the first release of the software, I grabbed it right away. I think I was the first person besides Satoshi to run bitcoin. I mined block 70-something, and I was the recipient of the first bitcoin transaction, when Satoshi sent ten coins to me as a test. I carried on an email conversation with Satoshi over the next few days, mostly me reporting bugs and him fixing them.

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.

After a few days, bitcoin was running pretty stably, so I left it running. Those were the days when difficulty was 1, and you could find blocks with a CPU, not even a GPU. I mined several blocks over the next days. But I turned it off because it made my computer run hot, and the fan noise bothered me. In retrospect, I wish I had kept it up longer, but on the other hand I was extraordinarily lucky to be there at the beginning. It’s one of those glass half full half empty things.

The next I heard of Bitcoin was late 2010, when I was surprised to find that it was not only still going, bitcoins actually had monetary value. I dusted off my old wallet, and was relieved to discover that my bitcoins were still there. As the price climbed up to real money, I transferred the coins into an offline wallet, where hopefully they’ll be worth something to my heirs.

Later in 2009, Martti Malmi a.k.a. Sirius, a software developer from Finland, sold 5,050 BTC for just $5,02 to NewLibertyStandard. The transaction was realized using PayPal in 2009.

After that in 2010, when Bitcoin reached some monetary value, people tried to buy Pizzas with it, and this was the first official record of Bitcoin being used to buy goods and services.

On 22 May 2010, two Papa John’s Pizzas were exchanged by Laszlo Hanyecz for 10,000 BTC. This was the first official documented purchase of goods using bitcoins.

At that time, the worth of 10,000 BTC was $41.

At the time of writing this article, the worth of 10,000 BTC is around $36 million.

So this is how the first Bitcoin transaction worked and what all have happened after that is just history in the making which we all are witnessing together.

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Avatar for Jeth-jeth
Written by   39
3 weeks ago
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Comments

Wow interesting story bitcoin thanks for the sharing it with us dear friend.. I really appreciate your post....

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3 weeks ago

I am glad that you like my article😊

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3 weeks ago

I am glad that you like my article😊

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3 weeks ago