Bitcoin Price

When Satoshi Nakamoto released the Bitcoin software in January 2009, bitcoin had no price because it could not be used for anything. As Satoshi wrote:

As a thought experiment, imagine there was a base metal as scarce as gold but with the following properties: boring grey in colour, not a good conductor of electricity, not particularly strong, but not ductile or easily malleable either, not useful for any practical or ornamental purpose, and one special, magical property: can be transported over a communications channel.

If it somehow acquired any value at all for whatever reason, then anyone wanting to transfer wealth over a long distance could buy some, transmit it, and have the recipient sell it.

The first known commercial transaction occurred in May 2010 when Laszlo Hanyecz paid 10,000 BTC for two pizzas, valuing bitcoin at roughly $0.004. By early 2011, bitcoin reached $1 for the first time. It briefly touched $31.50 in June 2011 before crashing back to $2 by November. The year 2012 was calmer, with bitcoin trading under $15 for most of the year before climbing to $13 by year-end.

2013 began with bitcoin around $13 and saw two dramatic rallies. The first hit $266 in April before crashing to $50 within a week. After months of consolidation, U.S. Senate hearings on Bitcoin in November triggered a second rally that briefly touched $1,240 before ending the year around $800.

The collapse of Mt. Gox in early 2014 (at the time the largest Bitcoin exchange, handling ~70% of global volume) shook confidence. Over 850,000 bitcoins were reported lost. The price ground down throughout 2014, ending the year around $325. Despite the price decline, over $300 million in venture capital poured into Bitcoin infrastructure during the year.

Bitcoin traded in a narrow range for most of 2015, bottoming around $200 in January before slowly recovering to $430 by year-end. Infrastructure matured: Coinbase launched a regulated U.S. exchange, and major financial institutions began exploring blockchain technology.

The second halving occurred in July 2016, reducing the block reward from 25 to 12.5 BTC. By year-end bitcoin had climbed to $960, setting the stage for the run ahead. Notably, the price of bitcoin surpassed the price of an ounce of gold for the first time in early 2017.

2017 was the year Bitcoin entered mainstream consciousness. Starting the year just under $1,000, it climbed steadily through the spring, accelerated in the summer, and went parabolic in December, touching nearly $20,000 on some exchanges. The CME and CBOE launched Bitcoin futures contracts, and initial coin offerings (ICOs) drove a broader crypto frenzy.

The crash that followed was brutal. Bitcoin fell throughout 2018, losing over 80% of its value and bottoming near $3,200 in December. Many crypto projects failed. The period is widely referred to as "crypto winter." Despite the price collapse, development on the Lightning Network and other infrastructure continued.

Bitcoin recovered to $13,800 by mid-2019 before settling back around $7,200 by year-end. Facebook announced its Libra stablecoin project, bringing renewed mainstream attention to digital currencies.

In March 2020, the COVID-19 pandemic triggered a global market crash. Bitcoin fell to $3,800 in a single day alongside equities. It recovered swiftly, and the narrative shifted: with unprecedented central bank money printing, Bitcoin's fixed supply became attractive as a potential inflation hedge. MicroStrategy became the first publicly traded company to add bitcoin to its balance sheet. PayPal launched bitcoin buying for its 350 million users. By December 2020, bitcoin had surpassed its previous all-time high, ending the year above $29,000.

2021 saw two major peaks. Bitcoin reached $64,000 in April, fueled by Tesla's $1.5 billion purchase and the Coinbase IPO (valued at $86 billion). After a summer correction to $30,000, it rallied again to a new all-time high of $69,000 in November. El Salvador became the first country to adopt bitcoin as legal tender in September 2021.

2022 brought a cascade of failures. The Terra/Luna algorithmic stablecoin collapsed in May, wiping out $40 billion. Celsius, Voyager, and Three Arrows Capital followed. The FTX exchange collapsed in November after revelations of fraud, sending bitcoin below $16,000. Despite these industry shocks, the Bitcoin protocol itself continued operating without interruption, processing every valid transaction throughout the turmoil.

Bitcoin began 2023 around $16,500 and climbed steadily, driven by growing anticipation of a spot Bitcoin ETF in the United States. BlackRock, the world's largest asset manager, filed its ETF application in June 2023, lending significant institutional credibility.

In January 2024, the SEC approved 11 spot Bitcoin ETFs simultaneously, a watershed moment. Billions of dollars flowed into these funds within weeks. The fourth halving occurred in April 2024, reducing the block reward to 3.125 BTC. Bitcoin surpassed $73,000 in March 2024, setting a new all-time high. By the end of 2024, bitcoin was trading above $90,000, with total ETF holdings exceeding 1 million BTC.