Bitcoin Just Hit $100,000, But How Did It Get There?

By hitting the vaunted $100,000 mark this morning, the cryptocurrency has officially skyrocketed more than 159% since its low of $38,505 earlier this year. According to CoinMarketCap, it is the largest cryptocurrency with a market capitalization of about $2 trillion, more than the GDP of Spain.

Bitcoin created initial weakness at $100,000 on November 25 but has fallen back to just over $98,000 amid massive profit-taking by longtime holders, according to analytics company Glassnode. It hit the $98,000-plus mark again on Thanksgiving Friday, before falling back down.

However, after taking another break, BTC finally reached above $100,000 today. The new record high appeared to be triggered by President-elect Donald Trump announcing he had chose Paul Atkinsa pro-cryptocurrency candidate, to lead the Securities & Exchange Commission. Atkins will replace current SEC Chairman Gary Gensler, who has angered the crypto world by bringing multiple lawsuits against crypto companies..

However, the digital currency does not always soar. Through more than a decade of ups and downs, crashes and euphoric highs, the currency has survived and has now reached the six-figure threshold that few true Bitcoin believers ever expected.

How did we get here?

Origin of Bitcoin

The idea of ​​Bitcoin was proposed by an anonymous individual or group of individuals named Satoshi Nakamoto during the 2008 recession. in a white paperNakamoto laid out his vision of a peer-to-peer currency that existed beyond the control of major financial institutions and governments.

Using a new technology called blockchain, Nakamoto created a digital currency backed by miners, who help operate a transparent public ledger where everyone can observe. Monitor transactions as they occur. In 2009, the first block was mined on the Bitcoin blockchain.

Because Bitcoin has a limited supply of 21 million coins and a mechanism that halves miners’ rewards over a four-year period, the asset is deflationary—meaning each new token gets more expensive —and many have turned to it as a store of value, of sorts. to gold.

First famous Bitcoin transaction

But it was initially a slow start for the newly created digital currency. While the cryptocurrency attracts followers and developers to help it grow, it still isn’t worth much and is rarely accepted as a real currency anywhere.

On May 22, 2010, Florida resident Laszlo Hanyecz made an agreement with another user on a Bitcoin forum to accept Bitcoin for pizza. In one of the most infamous bitcoin transactions to come, Hanyecz sent forum members 10,000 Bitcoin, worth about $41 at the time, for two pizzas worth about $25, according to Benzinga. 10,000 Bitcoins would be worth about $1 billion at today’s new record price.

In 2019, Hanyecz speak 60 minutes He’s not too upset about what now looks like a lopsided deal. The crypto community still celebrates May 22 every year as “Bitcoin Pizza Day,” and Hanyecz is very happy with that.

“It’s wonderful to have a holiday in my honor,” he said 60 minutes.

Gain some recognition

In 2012, the first Bitcoin halving caused mining rewards to decrease and slow down the money supply. By 2013, Bitcoin price surpassed $100 for the first time.

At this time, financial regulators began to pay attention to the emerging currency, but not always in a good way. Many regulatory agencies and financial giants, e.g JPMorgan CEO Jamie Dimonfound digital currencies to be limited in facilitating illegal transactions. They note that it is heavily used on the anonymous black market platform Silk Road, created by Ross Ulbrichtwho is known online as “Dread Pirate Roberts.” The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) also issued first instructions about the digital currency in 2013, leading users to realize that transactions in Bitcoin could attract the attention of law enforcement. China banned financial institutions from using Bitcoin that same year.

Bitcoin’s first boom

Partly because The 2014 collapse of cryptocurrency exchange Mt. Gox—the largest at the time—the cryptocurrency saw a wave of skepticism and sell-off. But Bitcoin saw its first signs of a boom in 2017, when its price broke $19,000 for the first time.

Institutions are also starting to venture into the world of cryptocurrency. In 2017, the first futures contract was traded on the Chicago Board Options Exchange flooded the CBOE website. Later that year, the Chicago Mercantile Exchange also launched its own Bitcoin futures contract.

Another tailwind during this time is The ICO (Initial Coin Offering) Boom. Countless new digital currencies – not necessarily related to Bitcoin – appear and many investors buy them to speculate. However, while many coins later disappeared, Bitcoin, as the original cryptocurrency with solid mechanisms to protect its value, persisted, although by 2018 its price it (once again) fell into a downward spiral.

Pandemic Bitcoin fever

In 2020, Michael Saylor, the co-founder and then-CEO of MicroStrategy, began quietly stockpiling Bitcoin through his business intelligence company. MicroStrategy initially invested $250 million in the coin, but has since poured most of its cash into the asset and its holdings. Currently up to at least 30 billion USD.

Bitcoin then saw another boom in 2021, after the pandemic kept people at home, where they naturally gravitated toward meme stocks and digital currencies. The coin reached a record high at the time of $60,000 and attracted new investors such as Elon Musk’s Tesla and the country of El Salvador, led by president Nayib Bukele, a Bitcoin enthusiast. El Salvador is now said to be in possession more than 500 million USD of Bitcoin.

Why is Bitcoin price increasing at this time?

The coin increased in price in January this year after the Securities and Exchange Commission approved The first Bitcoin spot exchange-traded fund (ETF), which directly tracks the price of the cryptocurrency. ETFs have helped push up Bitcoin prices by making it much more accessible for retail investors to trade more comfortably with traditional financial institutions.

In recent weeks, Bitcoin prices have exploded, especially after Donald Trump won the US presidential election. Investors expect that Trump will be friendlier to crypto, a marked change from the often antagonistic stance adopted by Gensler, the Biden Administration’s SEC Chairman.

Among Trump’s Bitcoin-friendly proposals are “strategic Bitcoin reserves” and creation a cryptocurrency advisory council may include leading US cryptocurrency companies. Trump’s tariff proposal may also have caused investors to flock to stores of value assets like Bitcoin as a hedge against inflation.