From Bouncing Baby To Troubled Teenager – Forbes Advisor UK

Conceived in 2008 and launched in 2009, bitcoin is the world’s first and largest cryptocurrency. 

Back in 2010, a single bitcoin could be purchased for roughly £0.07. Today, its value is more than 24,000,000% higher.

But it hasn’t all been gains. In the years since, we’ve seen prices peak as high as £56,000, but we’ve also seen prices fall by as much as £20,000 in as little as three weeks.

Here’s a brief history of bitcoin’s biggest price movements and the milestones along the path, from thousandths of a penny to tens of thousands of pounds.

Remember that investment in cryptocurrency is purely speculative and all your capital is at risk – you may not get any of your money back. The cryptocurrency market is unregulated in the UK and you will have no recourse to compensation if anything goes wrong.

Bitcoin begins

One of the most interesting aspects of bitcoin is that nobody knows who created it. 

The 2008 whitepaper that laid out how the cryptocurrency would work – Bitcoin: A Peer-to-Peer Electronic Cash System – was authored by a person or group of people using the pseudonym Satoshi Nakamoto.

There have been several investigations to determine the true identity of bitcoin’s creator, but while several computer scientists and cryptographers are thought to have been bitcoin’s creator(s), nobody has so far been able to identify Nakamoto with any certainty.

Beyond bitcoin

Bitcoin sparked the birth of an entire market of alternative cryptocurrencies in 2011 when Namecoin, the world’s first ‘altcoin’ is created. 

While bitcoin is created to facilitate decentralised payments, Namecoin is created as a decentralised alternative to DNS – which is essentially the ‘phone book’ of the internet, translating website addresses like to their corresponding IP addresses in order to route traffic.

Litecoin follows soon after, and is able to confirm transactions four times faster than bitcoin.

Within 10 years, thousands of altcoins will have been created – including bitcoin’s biggest competitor, Ethereum (ETH).

Bitcoin stabilises, then rallies

2013 marks perhaps the most stable period in bitcoin’s history, holding its value at around the £100 mark for most of the year before spiking for the very first time in the winter. 

Bitcoin surges from around £105 in October 2013 to around £950 in April 2014.

Bitcoin breaks £1k

The cryptocurrency first hits £1,000 in March 2017. By the end of the year it has risen to more than £13,000 as the currency makes its debut on the futures market, allowing investors to pledge to buy an agreed amount of the asset at an agreed price on an agreed date in the future.

Four months later, that figure has fallen by around two thirds to roughly £5,000. This follows a period in which Google announces it will ban adverts for cryptocurrencies, German researchers discover links to child abuse imagery hidden in Bitcoin’s blockchain, and thieves in Iceland make off with 600 bitcoin mining rigs.

Commentators respond with headlines such as “Bitcoin is Ridiculous. Blockchain is Dangerous”, and payments platform Stripe ends support for bitcoin payments.

Prices waver at those levels until late December 2018 before falling to around £2,000 – £3,000 for the next few months. 

During this time, the 30-year-old CEO of Canada’s biggest crypto exchange, Quadringa, dies, leaving £145,000,000 owed to around 115,000 customers locked in a bitcoin wallet. 

The first major derivatives exchange to offer bitcoin futures,Cboe Global Markets, also drops the cryptocurrency.

But March 2019 marks the beginning of a short-lived bitcoin bull run, with prices almost hitting £9,000 by the summer – its highest value to that point. 

This is despite claims from a crypto index and ETF provider that 95% of reported bitcoin trading volume are fake. Bitwise Asset Management’s analysis of 81 exchanges claims daily trading volumes are closer to £222 million than the £4.8 billion reported by CoinMarketCap.

Bitcoin explodes

What follows is a relative plateau for prices. During this time, a high profile bitcoin scam sees the Twitter accounts of celebrities hacked. Targeted accounts, including the likes of US Presidents Joe Biden and Barack Obama, send out tweets asking for donations in cryptocurrency.

After September 2020, bitcoin’s value explodes. Within six months, the cryptocurrency reaches a new record high of around £43,000. Owner of Tesla Motors, Elon Musk, announces his company will accept cryptocurrency as payment.

In May 2021, however – a month after peaking – bitcoin loses around £20,000 of its value, falling to around £24,000. The losses came after reports that China would crackdown on crypto mining and trading with new regulations.

Prices begin to recover in July 2021, rising to £35,000 by late August, before falling to £31,000 the following month. Prices rise until an all-time high of £56,000 is reached in November before a downturn that will last until January 2022 when prices hit £25,000

Wintry conditions

A short-lived recovery takes prices back to £35,000 by April 2022, before a downturn into a so-called ‘crypto winter’ that currently has bitcoin’s value down to around £17,000 – 51% down on the start of the year and down 31% on the same period last year.

Few would care to speculate with any confidence on how bitcoin’s price will move over the coming days, weeks and months. A look at its history shows the dramatic twists and turns it has taken – and it seems fair to suggest that investors in this or any other cryptocurrency should buckle-up for a bumpy ride.

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