Bitcoin is going up! Buy it or sell it?
Updated: Jan 11
Bitcoin has just broken the USD 40.000 record, reaching a market value of over $700 billion that has contributed to lift the total value of the entire cryptocurrency market above $1 trillion for the first time ever, and in the present context of uncertainty and lack of trust in governments, it seems to be the golden opportunity (literally!).
With a variation of over 400% in just one year, and having outperformed Gold, it’s growth has captivated the attention of not only investors but also savers all around the world.
Despite some low points over the past 12 years since its inception bitcoin has always risen above… But don’t take it from me. Let’s do an exercise and see how much money some of the key transactions on the history of bitcoin are worth nowadays.
Bitcoin was first introduced to the world by an unknown individual or group working by the name Satoshi Nakamoto. Nakamoto announced on the mailing list Metzdowd's cryptography the launch of the first version of Bitcoin on January 9 of 2009. With this launch, the growth of Bitcoin as an economic system would be unleashed.
After Bitcoin’s debut, Nakamoto received a congratulatory message from a guy called Hal Finney, the first interested individual on the idea. And in exchange for his support, on the 11th of January 2009 Nakamoto sent him a total of 10 BTC, thus executing the first Bitcoin transaction ever made. At that moment, that transaction had absolutely no economic value and was just a meere test of the system. Today this transaction would be worth over 384.500 USD.
The first economic transaction
In February 2010, one bitcoin was worth just 0.03 USD and for months it stayed that way. Programmers were mostly just "mining" the cryptocurrency and discussing the project on BitcoinTalk.org. But on May 21st 2010, that changed forever. Laszlo Hanyecz, a programmer living in Florida, had a bunch, and just thought it'd be kind of a kick to see if he could use it to get dinner. So he sent a volunteer in England 10.000 BTC and asked him to get a “Papa John's” pizza for him, which is widely believed to be the very first real-world bitcoin transaction. That dinner would be today the most expensive dinner ever purchased at a value of 374.920.798 USD, and yes, that's millions!
As a reminder of this event most hardcore Bitcoin fans celebrate the bitcoin pizza day by purchasing pizza using their bitcoins.
Hitting a low point
Over the next years, since that pizza transaction, bitcoin grew as the most important cryptocurrency in the world hitting a new high of USD 19,783.06 on December 17th of 2017, after its value went up 5% in just 24 hours, increasing 1.824% ever since the beginning of the year.
Despite this record, it's important to notice that Bitcoin suffered sudden drops on it's price, hitting a low of 3.300 USD on the 7th of December of 2018, just over 2 years from the time of writing this article.
To the moon and beyond
So it hasn't been a bed of roses, but it seems that Bitcoin has always exceeded expectations. After hitting rock bottom, on July 27th 2020 it's price surged to the highest in almost a year. And since then, it’s skyrocketing.
There is a culture between Bitcoin fans that it's price will always rise. As the cryptocurrency has a fixed amount of coins that will be created, it's not susceptible to inflation and government policies as any other alternative. This culture is called HODL as its members are holders or keepers of the currency. And it seems that this culture is on the right side of history as everyone has become richer by following this simple rule: just don’t sell! If you had invested 1000 USD as early as July 17, 2010 on Bitcoin now you would be worth 837,524,276.2 USD. That amount in 2012 would be worth 3,703,063.1, in 2016 111,150.6 USD and even 4,841.9 USD if you have purchased on June 2020.
But don’t think about that missed opportunity… it's never too late!