Bitcoin turned 14 on Halloween this year.
How Far Has Bitcoin Come?
Back on October 31, 2008, Satoshi Nakamoto – the pseudonymous creator of the world’s largest and most powerful digital currency by market cap – sent the whitepaper for the new anonymous financial system to emails across the world. In the paper, Nakamoto wrote the following:
What is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party.
At the time of the whitepaper’s arrival, the world was going through a tough financial situation. The Great Recession was in full swing. Countries everywhere were seeing their economies tank faster than the RMS Titanic. Banks were flopping, and while the government was bailing out big businesses, small enterprises along with people’s 401Ks dropped to their lowest levels. Things were ugly, and in many ways, it’s what we’re witnessing all over again this time around.
The crypto space has been crashing and burning for the last several months. Bitcoin has dropped by more than 70 percent from its November 2021 all-time high of about $68,000 per unit and is now trading in the low $20K range. The digital currency arena has also lost more than $2 trillion in valuation over the last several months.
Bitcoin was first introduced as a means of fighting the recession and similar financial circumstances. The idea was that a contactless payment method allowing parties to transact with each other directly – thus omitting third parties, prying eyes, and middlemen who could decide what you could and couldn’t do with your money – would prevent another recession from occurring and give the world the monetary break it so desperately needed.
Now, 14 years later, one could argue that the experiment has failed. The economy is once again heading into Great Recession territory, and the price of bitcoin has experienced its worst battering ever, but many analysts claim that the asset remains only battered… Not beaten.
Garrick Hileman – a visiting fellow at the London School of Economics – stated in an interview:
It’s been battle-tested in a way that no other cryptocurrency ever has… both in terms of its longevity and how much value it’s been securing over that time. Nothing else comes close… Fourteen years. It seems like a long time, but compared to stocks, which have traded for hundreds of years, or bonds, that’s a drop in the bucket.
We’re Still Early in the Game
Catherine Valega – a certified financial planner with Green Bee Advisory – seems to agree, stating:
If you are a crypto believer, you sort of think it’s [like] the early days of the internet or the early days of the iPhone. It remains to be seen how it shakes out, but the technology is incredible.
