It’s sometimes easy to forget that Bitcoin (BTC) is just a teenager, launched in 2009 by the enigmatic Satoshi Nakamoto.
Since then, Bitcoin has seen a meteoric rise, increasing from fractions of a penny to an all-time high of $73,750, with a market capitalization reaching $1.44 trillion on Mar. 14, 2024.
The big “B” was the best-performing asset class of the decade preceding that all-time high. Bitcoin returned more than 230% during the ten years ending in March 2021. For that reason alone, it’s now firmly entrenched in the mainstream.
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But Bitcoin’s price journey has been far from smooth. The original digital currency has experienced many violent dips and pumps. Let’s take a closer look at the ups and downs of Bitcoin’s price history.
What Price Did Bitcoin Start At?
Bitcoin was originally worth next to nothing.
The transaction that first gave Bitcoin monetary value was in October 2009, when Finnish computer science student Martti Malmi, known online as Sirius, sold 5,050 coins for around INR 414.65, giving each Bitcoin a value of $0.0009 each.
The exchange took place on PayPal, which can be hard to believe given the number of crypto exchanges dedicated to buying and selling BTC nowadays.
Bitcoin Surpassed Its All-Time High : 2024
Spot Bitcoin ETFs recorded around $300 million in net inflows yesterday, July 8, 2024, marking their highest buying activity since early June, when the cryptocurrency traded over $70,000. As of July 9, 2024, BTC is trading at $57,497 with a market capitalization of $1.13 trillion. The price of the popular cryptocurrency has fallen by 22.33% after setting a new record of $73,750, with a market capitalization reaching $1.44 trillion on March 14, 2024.
Bitcoin halving was completed on April 20, 2024. Halving did not bring the surge that investors had anticipated. BTC is currently undergoing correction. So far, the year has witnessed U.S. Securities and Exchange Commission approval on 11 Spot Bitcoin ETFs and later Ether ETFs. Spot Bitcoin ETFs approved in January 2024 were one of the significant reasons BTC surpassed its all-time high multiple times in March.
Later, Bitcoin witnessed a downtrend and fell below $60,000 but bounced back to $70,000 within days after the SEC approved the ETH ETFs in the U.S. on May 23, 2024.
At the beginning of 2024, in the first week of January, BTC traded at around $43,906, with a market capitalization of around $915.81 billion. The recovery and rise have brought stability to the BTC and ETH coins.
As of Feb. 29, 2024, BTC hit the exceptional level of $62,642 for the first time since Dec. 2021, with a market capitalization of $1.23 trillion and a cryptocurrency market capitalization of $2.29 trillion way before Bitcoin Halving.
BTC set a new record of $73,750 and a market capitalization of $1.44 trillion on Mar. 14, 2024. After six days, its valuation plummeted to $64,018, with a market capitalization of $1.20 trillion. Its current valuation is at $57,497 as of July 9, 2024.
Bitcoin Recovery: 2023
The Bitcoin market witnessed a strong recovery in 2023 after facing a slight downside due to global macroeconomic situations and inflation data. The year turned out to be uncontrollable for Bitcoin.
In January, Bitcoin was trading at a low value of $16,000; it peaked in July at $31,000, with a market capitalization of around $607 billion.
The stubborn inflation in countries like the U.S. and the U.K. also led BTC to fall below $26,000. But Bitcoin walked the stairs of recovery in the second half of the year. In July 2023, it reached around $30,500 but maintained recovering stability from October, trading at around $34,298. At the end of 2023, BTC was trading at $42,809 as of Dec. 20, with a market capitalization of $838.58 billion.
Crypto Winter: 2022
Since November 2021, Bitcoin has struggled with the rest of the market. The up-only narrative from the days of money printing was over, with economies struck by rampant inflation.
The Fed has been hiking interest rates since early 2022, punishing assets furthest out on the risk spectrum the most. Higher interest rates mean a higher borrowing cost, less investment, and a general reduction in the economy’s demand.
Bitcoin has been in freefall since early this year amid the crypto winter. The most damaging month this year was May, when the collapse of stablecoin TerraUSD sparked a round of contagion in the cryptocurrency markets, pulling Bitcoin down from $39,000 in early May to $20,000 by mid-June.
Investors hoped this downturn is the latest dip to precede a sharp rise, as history has repeatedly shown for Bitcoin. Historically, October was known as a “green” month, with an average increase of 26%. If that’s the case, we witnessed prices head toward the $24,000 mark.
Bitcoin Recovers: 2018 to 2021
The year 2018 didn’t slow Bitcoin’s downtrend. BTC’s price collapsed, closing out the year below $4,000. Then, the digital currency closed out in 2019 at around $7,000.
With two years of relative inactivity and a consistent downtrend, many wrote Bitcoin off as a fad, having failed to solidify its place in the mainstream market.
Then, the Covid-19 pandemic struck, and the stock markets dropped violently in mid-March 2020.
Bitcoin wasn’t spared, shedding 50% of its value in less than 48 hours to trade below $4,000. Some hypothesized that the Covid-inspired dip would be Bitcoin’s final nail in the coffin.
But those skeptics were very wrong. As the Federal Reserve responded to the Covid-19 pandemic by printing money for fiscal stimulus, asset prices rose sharply.
Growth and tech stocks showed explosive gains, but Bitcoin got everybody talking. After halving to less than $4,000 in March, BTC hit $10,000 in May 2020.
But it made its actual move in the final quarter of 2020. It shattered its all-time high by breaching $15,000 in November 2020, moving above $20,000 in December 2020, and ending the year at around $29,000 with a market cap of more than $539 billion.
As retail investors poured into markets and the Federal Reserve kept printing money, assets continued to inflate. Bitcoin hit $40,000 a week into 2021, $50,000 in February 2021 and $60,000 in March 2021.
After a turbulent couple of weeks in May, it dropped to less than $32,000 before rising to another all-time high close to $69,000 in November 2021.
Bitcoin Attracts Investors: 2013 to 2017
Bitcoin’s price trajectory began to change in 2013. By the end of 2014, exchanges, most notably Mt. Gox, handled 70% of all Bitcoin transactions and started onboarding more users. As a result, crypto became more accessible.
The price followed the increase in adoption. Opening in 2013 at $13, BTC skyrocketed to breach $1,000 by November 2013.
Success waned the following year after the Tokyo-based Mt. Gox experienced a security breach with hackers stealing $60 million from its coffers. Mt. Gox shut down due to insolvency, causing Bitcoin to slump to around $300 by the end of the year.
“The Mt. Gox case generally demolished investor trust in BTC, and it affected the sentiment toward crypto on a much broader scale,” said Alex Faliushin, CEO of crypto lending platform CoinLoan.io. Between 2015 and 2016, Bitcoin trudged slowly along, making the price action relatively muted. It closed in 2016 at around $1,000.
The following year, more investors poured into the asset as increasing media coverage drew in the average retail customer. Price barriers were easily torn apart. BTC broke through $1,000 in early January 2017 and $2,000 in May 2017. BTC then doubled to $4,000 in August 2017.
Now, Bitcoin was finally beginning to win doubters over. Futures contracts began trading on the CME, and many in the market felt that Bitcoin was becoming a genuine financial asset class.
The “fear of missing out” took hold, and more and more people flooded in to buy this up-only asset. Bitcoin popped to $10,000 in November 2021 before nearly doubling to almost $19,000 the following month.
Little did investors know then, but it took nearly three years to regain these price levels.
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Bitcoin’s Early Years: 2009 to 2012
The growth in BTC adoption in the early years started slow. Bitcoin’s pricing data on Google Finance only goes back to Nov. 20, 2015. The early years were characterized by very little infrastructure, with only a few hobbyists buying and selling BTC.
“There was no action to speak of and no news cycle,” says Alex Preda, a professor of professions, markets, and technology at King’s Business School in London. “Bitcoin was a fringe phenomenon confined to a subculture of software engineering and not a financial phenomenon.”
The first “real world” transaction occurred in May 2010 on a Bitcoin forum. Posting to the bitcointalk.org forum, Florida native Laszlo Hanyecz enquired whether anyone would order him two pizzas for 10,000 Bitcoins.
After purchasing two pizzas from Papa John’s worth approximately INR 3,380, the price of each Bitcoin came to $0.0041. Those pizzas are the most expensive ever ordered, worth nearly INR 16 billion today, averaging around INR 1 billion per slice.
Hanyecz did the impractical transaction for the sake of it, telling The Sun, “I wanted to do the pizza thing because, to me, it was free pizza. I coded this thing and mined Bitcoin, and I felt like I was winning the internet that day.”
Bitcoin wasn’t even worth a dollar until February 2011. That’s when the fireworks started. By June 2011, the price of Bitcoin had shot up 30 times, reaching a value of INR 2,471. In a hint of what was to come, the spike didn’t last long, with Bitcoin dropping to INR 411.
Liquidity was low in late 2011, and Bitcoin’s first competitor, Litecoin (LTC), emerged on the crypto scene in October 2011. The introduction of LTC spelled some doubt among the community, with a 90% drawdown testing resolve. Despite a slight rebound, 2012 was uneventful, and BTC closed the year around INR 1,070.
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