The world has changed significantly in the past decade, but not many things have changed as fast as cryptocurrencies. Bitcoin was released in 2009, and by 2015, it was still something for tech enthusiasts, even though it was already much more valuable than in its early days. One could barely buy a pizza with it in 2009, but by December 2015, it was worth USD 377.41.
This price may seem laughable to today’s standards, but the valuation was outstanding nonetheless. However, bigger changes were yet to come. Apart from memecoins and stablecoins, central banks around the world jumped into the crypto wagon with CBDC (central bank digital currencies), and a few countries have adopted BTC as legal tender.
Nowadays, it’s possible to buy anything with them anywhere: Microsoft, Starbucks, Home Depot, Whole Foods Market, AT&T, CheapAir, and many others. More than 15,000 businesses across the globe (over 2,3000 only in the United States) accept it now, and numbers keep rising.
Unsurprisingly, over 40 million users keep their eyes on all Bitcoin price fluctuations, as it could make or break their savings, investments, and business plans. Here are some key moments that have changed the course of cryptocurrencies in the global economy in the past decade.
Changing the Financial Landscape
Not many transactions are carried out in cold, hard cash these days. Most payments are made digitally via credit/debit cards, digital wallets, and other options. In fact, the market of digital payments is set to register over USD 20 trillion worldwide by the end of this year. In this context, cryptocurrencies have become just another option.
After all, cryptos are digitally born and very well adapted to this environment. Besides, it offers advantages that traditional methods can’t match, like anonymity, security, low fees, and seamless cross-border transactions where the parties involved don’t need to worry about foreign exchange.
Digital Landmarks
Pizza Day (May 22, 2010) is part of Bitcoin folklore, when a guy purchased two pizzas for BTC 10,000, enough to make anyone a billionaire these days. Albeit funny, the transaction kick-started a major transformation for cryptocurrencies, which were nearly worthless back then. The rise to stardom and the subsequent growing pains would take only five years to brew. Check out the timeline below.
Fame and Scams
Buying pizzas with cryptos was no longer that difficult in 2014, when BTC prices reached USD 770, and even the most conservative investors started opening their eyes to the new opportunity. Indeed, the impressive rise attracted not only investors but also scammers. Mt. Gox, one of the largest crypto exchanges back then, suffered a massive cyberattack, losing 850,000 BTC.
The digital environment wasn’t as safe as today, and centralized exchanges with insured protections weren’t a thing yet. So, many investors got ripped off overnight and never saw their tokens again. Understandably, the event has cast a huge shadow over cryptocurrencies as safe investments, and many investors have stepped back. The situation pushed developers to come up with more secure centralized crypto exchanges (CEXs) to ensure their survival.
The Rise of Ethereum
In 2015, there was a new kid on the block(chain): Ethereum. The new crypto was valued at a fraction of BTC, and one unit would cost less than a dollar. Yet, it was much more than BTC’s poor cousin, as it brought ground-breaking innovations to this market, most noticeably automated smart contracts and non-fungible tokens (NFTs) while premiering the concept of decentralized finance (DeFi), launching the bases for decentralized applications (dApps).
Ethereum became the second-largest cryptocurrency in the market, a position it has held until today. Unfortunately, it wasn’t immune to scams either, suffering a USD 60 million blow on its DAO (decentralized autonomous organization), which was supposed to back its investments. Like with BTC, the event forced major changes on the blockchain.
Back to Popularity
Between 2017 and 2018, Bitcoin rose to unprecedented heights, registering market values above USD 10,000 for the first time. However, due to network scalability problems, a “crypto winter” followed the hype, pushing for improvements and making way for the creation of the Lightning Network and Bitcoin Cash. In 2020, BTC was back in the spotlight, and in a spectacular fashion, with a single unit costing as much as USD 70,000.
Meanwhile, in Ethereum’s backyard, NFTs started to gain traction as an investment option. The apparently silly CryptoKitties game involving the famed NFTs became popular enough to create massive congestion on its blockchain, hinting at their potential. More seriously, the Ethereum blockchain became a hotbed for DeFi projects like DEX (decentralized exchanges).
Central Banks - The Odd Ones Out
Given the decentralized nature of cryptos, it was quite a surprise when the first central bank decided to step into the game. The Central Bank of the Bahamas was the first to create the Sand Dollar in 2020, a digital version of the national currency to promote financial inclusion and smooth out transactions in the archipelago. In 2021, El Salvador was the first country to turn BTC into a legal tender.
Into the Stock Market
Last year, the Securities and Exchange Commission (SEC) decided to regulate spot bitcoin ETP (exchange-traded products) after disapproving of over 20 rule filings in the past. The major change finally allowed investors to trade spot bitcoin shares, sending ripples across the global market.