By Tim Hakki
3 min read
Happy birthday, Bitcoin! Twelve years ago today, one pseudonymous ‘Satoshi Nakamoto’ mined the Genesis block into existence, earning 50 bitcoin. Back then it was worthless, now the value of the block reward sits at an all-time high of $1,720,000.
Today is the anniversary of that first drill into a strange new world—and the day it set its all-time high, $34,608. Genesis block would be the first of, to date, 664,324. Stranger still, Nakamoto left a cryptic message within the block’s raw data: ”The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”
It’s a reference to the headline of an article in the January 3, 2009 edition of The Times. Nakamoto is saying that Bitcoin, a decentralized payments network, is safe from the misdemeanors of large financial institutions that were at their worst in the 2007–2008 financial crisis, and has escaped the governments that had to buy them out. Bitcoin, argues Nakamoto, is different to the banks.
Bitcoin’s price took a few years to take off, but by the end of 2017 there was a huge boom, reaching a high watermark of almost $20,000. The price promptly crashed in early 2018, screeching below $4000 dollars by the end of the year with a market cap of below $100 billion.
By early 2020 Bitcoin’s price had recovered to around $10,000. But it took a pandemic to the global financial system hard enough for Bitcoin’s price to surpass its 2017 highs. In mid-March, 2020, Bitcoin crashed to lows of $4,300 along with global markets. Then it started to climb, slowly at first but then all at once, to the all-time of over $34,000 today.
If there’s anything that last year’s rise showed us, it’s that Bitcoin gained on the US dollar like an insatiable bulldog. In fact, a single US dollar is worth three thousand sats, according to usdsats.com. A sat is worth 100,000 Bitcoin.
This hungry rise on the dollar is often attributed to the endless whirring of machines printing US dollars to patch an economy collapsed by the pandemic. By October, the Fed had already printed over 20% of all US dollars in circulation. You can’t put money on a gunshot wound.
And the Fed has no plans to stop. It said last month that it’ll only stop when unemployment and inflation sink to pre-pandemic levels—and that will take about three years, according to Fed economists. Traders interpreted that as an advertisement for Bitcoin.
In the first seven months of Bitcoin's existence, Bitcoin’s pseudonymous creator, Satoshi Nakamoto mined as many as 1.1 million Bitcoin. This fortune, now worth in excess of $30 billion, remains untouched to this day.
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