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20.08.2019

The Evolution of Bitcoin: 2008-2019

Introduction.

As 2019 slowly arrives at an end, Bitcoin comes to its 11-years on the crypto market, being the first ever crypto to not only be launched as a guinea pig of the research but to become one of the most expensive and successful for the traders. In this article, we would like you to return back to the times when this topic was a matter of a pure mystery, and no one knew it will have even a fraction of the booming fame it has now.

So what is Bitcoin (BTC)?

Most digital currencies and Blockchain innovations are founded and based on the technologies of Bitcoin. It is a digital currency, a computerized resource intended to fill in as a mechanism of funds transfer that utilizes both powerful cryptographic protocols and reliable and transparent system, making it a great tool to use for secure and anonymous payments.

The foundation of Bitcoin is the blockchain innovation it uses to record the transactions inside the blockchain. A blockchain is basically an openly decentralized system, recording every single bitcoin transaction added into a block.

Blockchain is a public ledger that can be accessed by anyone in the network. To make the system transparent and reliable thousand of computers holding it on their hard drives or setting up nodes.

Since the database is put away on a large array of PCs, instead of on a single server, hacking the Bitcoin blockchain is an expensive task requires huge computational power. The only successful attack implemented on a Bitcoin blockchain is a brute force or so-called 51% attack.

The beginning of Bitcoin, 2008-2009 (1BTC = $0.003)


Satoshi Nakamoto

Bitcoin was set up on August 18, 2008, as a site on the web. As speculated by a few sources, the creator of Bitcoin, Satoshi Nakamoto, has started developing and working on the Bitcoin idea in 2007. While he is on record as living in Japan, it is said that Nakamoto might be a group of people, conjoined by an idea of a public cryptocurrency. The main clues that Nakamoto provided for others were facts of him living in Japan and to be born on April 5, 1975. Nakamoto had urged different cryptographers to help with the coding, however, the maker stepped away from Bitcoin development in 2011 and has not been seen around since.

On October, 2008 Nakamoto distributes a whitepaper through metzdowd.com cryptography mailing list that depicts the solving of a double-spending problem in Bitcoin. 

In mid-2009, Nakamoto mined the first-ever bitcoin, known as the “genesis block.” The content of this fact alludes to a feature on that date from the British newspaper The Times and is by and large observed as confirmation of the date Bitcoin was first mined. The other historical moment is the first BTC transaction when a Bitcoin was sent from Nakamoto to Hal Finney, a cryptography master, and aficionado.

The development of Bitcoin, 2010-2012 (1BTC = $1)

Bitcoin Pizza

In May 2010, a Florida software engineer named Laszlo Hanyecz offered 10,000 Bitcoins in return for two pizzas. A British lover took Hanyecz up on the offer and requested two pizzas to be delivered from a pizza spot close to Hanyecz’s apartment; the Briton paid for the pizza using a regular credit card, and Hanyecz repaid him with 10,000 bitcoins. 

This is regarded as the first buy/sell operation through bitcoin, and May 22 is praised in the bitcoin network as Bitcoin Pizza Day. What makes the exchange progressively more interesting, in any case, is the unbelievable worth of bitcoins used to buy two pizzas have collected. As we speak, those Bitcoins would now be worth around $90,000,000 and more!

Trading Platforms and Mt. Gox

Bitcoin trades are an essential piece of the crypto world and its environment specifically. Before the fall, Mt. Gox appreciated the status of being a monopolist as it overwhelmed an expected 80-90% of the Bitcoin-Dollar exchanging volume. Despite the fact that the breakdown of Mt. Gox brought up numerous issues, however, the repercussions went on for a limited ability to focus the exchanging volumes climbed again at different trades.

As of late, the market of the Bitcoin exchange and trade platforms has expanded drastically, including public and investor locked ones such as Poloniex, Coinbase, Bitfinex, Kraken etc.

The usage of Bitcoin, 2013-2015 (1BTC = $250)

The Shutdown of Silk Road

The cost of Bitcoin had dove after the supposed organizer of the online drug and weapon dealing center Silk Road was captured in San Francisco. On Wednesday evening the cost of one Bitcoin (BTC) was $145.70 on Mt Gox, one of the biggest trades for the money. After the news that Ross Ulbricht had been captured and the Silk Road site seized, the conversion standard dove to a low of $109.76, before recuperating to $124.00 late on Thursday. Soon the price has plummeted on more than a half, from $220.

Creation of Altcoins

Altcoins can either appear as a completely new crypto asset or can be based on a source-code of a previously created projects building another goal, marketing needs and etc. Examples of Altcoins are DASHLitecoinRippleEthereum and etc.

Numerous altcoins, since their presentation, have started to be generally acknowledged and perceived apart from the Bitcoin, which has been put into the overall view for a long while.

Ethereum, maybe the most famous altcoin, it added Virtual Machine above the blockchain with the support of Turing Complete algorithms. It leads to Smart Contracts creation. It is an agreement that will be executed automatically if certain requirements will be completed. Read our guide on Smart Contracts to learn more. Ethereum is also famous for supporting tokens and decentralized applications.

Another example – Litecoin, a well-known altcoin, was created by the previous Google engineer Charlie Lee; utilizing the central innovation of the Bitcoin blockchain with included enhancements, Lee created a silver coin, which main features is a faster block creation speed (1 minute) and cheaper transaction fees.

The new era and hype of Bitcoin, 2016-2019 (1BTC = $15,000)

Atomic swap

Atomic Swaps has the capability of totally changing the cash move framework in the crypto world. To place it in basic terms, Atomic swaps is a technology that allows exchanging one cryptocurrency to another without 3-rd party need. Basically, it allows exchanging crypto between 2 peers using Ethereum Smart Contracts Technology. The main benefits are anonymity (you don’t have to pass KYC to proceed with a SWAP). low exchange costs, and security. 

On September 20, 2017, Decred and Litecoin did the main known effective usage of the atomic swap.

Lightning Network

Lightning Network is a second layer innovation for bitcoin that utilizes micropayment channels to scale its blockchain’s ability to make transfers. It allows transfers between accounts without making records in the blockchain. That’s why the transactions are instant. You can read more about Lightning in our guide.

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