Cryptocurrency, also called virtual currency, is digital cash developed with technology and designed to be cheaper, more reliable, and quicker than regular money. It is a virtual means of exchange that utilizes cryptography for security. The term “crypto” means private or hidden. Cryptocurrency challenges the orthodoxy of how a regular currency works in many ways, including:
- All cryptocurrencies are completely digital
- Cryptocurrencies do not print money or mint coins
- Are created, exchanged, and regulated by their users
- Hide the identities of their users
History of Cryptocurrency
Bitcoin, the first of its kind modern cryptocurrency, although referred to as relatively new, has existed since 2009.
| Historical timeline of cryptocurrency and Bitcoin | ||
| 1998 to 2009 | Pre-Bitcoin years | Online currencies with ledgers, such as B-Money and Bit Gold, were formulated but never fully developed. |
| 2008 | Satoshi Nakamoto | Mysterious inventor of the cryptocurrency posted a whitepaper describing Bitcoin’s functionality to a cryptography mailing list. |
| 2009 | Beginning of Bitcoin | Bitcoin was made available to the public. The process through which Bitcoins are created and transacted were recorded and verified. |
| 2010 | Bitcoin valued for the first time | Traded for the first time on Bitcoinmarket.com. |
| 2011 | Rival cryptocurrencies | Namecoin and Litecoin |
Were there any cryptocurrencies before Bitcoin?
There existed a few pre-Bitcoin cryptocurrencies before the secure and functional Bitcoin took over. Some of those include:
- DigiCash
- Introduced in 1989
- A system to withdraw banknotes, and encrypt and send them over to a client’s third party
- B-Money
- Incepted in 1998
- A distributed electronic cash system with anonymity
- E-Gold
- Launched in 1996
- Offered the first-ever cross-border online transaction
- Facilitated the exchange of digital representations of significant metals abroad
- Bit Gold
- Released in 1998
- Closest predecessor of Bitcoin
- Had an architecture similar to Bitcoin
- Hashcash
- Developed in the mid-1990s
- Developed to eliminate e-mail spam and DDoS attacks
- Traces of it are still relevant today
How did Bitcoin first appear?
- Bitcoin was invented in 2008 by an unknown group of people or person.
- The site bitcoin.org was registered on August 18, 2008.
- On October 31, 2008, a paper titled “Bitcoin—A peer-to-peer electronic cash system” was posted to a discussion of the mailing list on cryptography
- The paper detailed the techniques of using a peer-to-peer network to develop a system for digital transactions without having to rely on trust.
- On January 3, 2009, the network of Bitcoin came into being.
When did the first Crypto Exchanges and Altcoins appear?
On March 17, 2010, Bitcoin had its first exchange on the now-defunct site BitcoinMarket.com. Later on May 22 of the same year, a Florida-based programmer traded 10,000 Bitcoins for two pizzas from Papa John’s, making the transaction on the first real-world Bitcoin exchange.
Altcoins are any cryptocurrency other than Bitcoins and were introduced in April 2011 following the success of Bitcoins. They also offer privacy and high transaction speeds. As of February 2020, altcoins account for nearly 33 to 34% of the entire cryptocurrency market.
Current Cryptocurrency market
Bitcoin rise and falls with times and have touched the $10,000 mark. The market cap of all cryptocurrencies has risen from $11 billion to over $300 billion today. However, Bitcoin suffered a sharp drop this March in the wake of the COVID-19 pandemic.
The decline most likely occurred because of investors using the cryptocurrency as a liquidity source. Bitcoin is currently seated at $6,440, a decent 68% raise from the low $3,867 registered on March 13, 2020.
On the other hand, banks, including Deutsche Bank, Barclays, and Citi Bank, are investigating ways to work with Bitcoins. The blockchain technology behind Bitcoin is already revolutionizing the fintech industry.
Conclusion
As Bitcoin Lifestyle continues to grow, they have been described everything from the future of money to a scam. Will they succeed in replacing the centralized, government-controlled money with a decentralized, distributed alternative powered only by market forces? Well, given the cryptocurrency’s extremely volatile nature, no one can truly answer the question for now.
