Cryptocurrency, the first of its kind, is a digital currency. It has been through a lot of ups and downs. It works as a medium of exchange through a computer network. Best of all, it is not dependent on any central authority like a government or bank to stay alive. Cryptocurrency does not exist in physical forms such as notes or coins. Digital currency can be directly used as a mode of payment instead of cash or online money transactions. Cryptocurrency is the talk of the century. Built on blockchain technology, a cryptocurrency is a tradable digital asset. It exists only as online. To protect transactions, cryptocurrencies use encryptions. Currently, over a thousand cryptocurrencies are present in the world. The creator(s) of any crypto is prone to a great deal of risk, financially, physically and mentally. If history has anything to prove, then it is that the previous statement is true.
What started as a trial in 1983 has now started to become a legal tender in different countries. In 1995, American cryptographer David Chaum put the first-ever form of cryptographic digital payment into action. Bitcoin was the first decentralized cryptocurrency. Developer Satoshi Nakamoto created it in 2009. Cryptographic hash function SHA-256 was used in its proof of work scheme. To make internet censorship difficult, Namecoin was created in 2011. It was aimed at creating a decentralized DNS. In the same year, October, Litecoin was created. Instead of SHA-256 as its hash function, it used script. Later on, Peercoin used a hybrid system. It used both proof-of-work and proof-of-stake as its hash function.
Money is universal, and notes and coins are its forms. Similarly, in the digital currency world, cryptocurrency is money, and its most common type is bitcoin.
The domain name bitcoin.org was registered on 18 August 2008. Hal Finney was the first-ever receiver of bitcoin. He was the creator of the first reusable proof-of-work (RPoW) system in 2004. Other early cypherpunk supporters were creators of bitcoin predecessors: Wei Dai, creator of b-money, and Nick Szabo, creator of bit gold. The first-ever known transaction using bitcoin happened for nothing other than pizza! In 2010, Laszlo Hanyecz spent ₿10,000 to buy two Papa John’s pizzas from Jeremy Sturdivant. The Bitcoin Foundation was founded to promote bitcoin’s development and uptake in September 2012.
In 2011, the price of bitcoin was $0.30 per bitcoin. It, later on, increased to $5.27 in the same year. By 8 June, the price had become $31.50. The price fell to $11.00 within a month. It became $7.80 and then became $4.77 the following month. Bitcoin price became $5.77 in 2012 and then grew to $13.30. The price rose to $7.38 by 8 January and then crashed by 49% to $3.80 over the next 16 days. On 17 August, the price became $16.41 but fell again by 57%. It became $7.10 over the next three days.
When a cryptocurrency is released, the creators set its parameters. Cryptocurrency is the talk of the century. The parameters include how much there is, rules for buying and selling, how new cryptocurrencies are added to the marketplace, etc. These parameters cannot be changed later on. These rules indeed make bitcoin a scarce resource. For bitcoin, it is 21 million. “No one, not a government, not Satoshi themselves, can change that now that it’s been released,” says Leech. “You cannot duplicate Bitcoins; you cannot recreate them.” Bitcoin is much more precious than gold.
This is because gold and other minerals can be continuously mined, and no one knows how much is available. But it is not the same with bitcoin. Once the set limit is reached, no more bitcoin can be mined. Bitcoin can be easily transferred and stored. This is not the same with other minerals. If one wants to move gold, it’ll cost them a lot of money (armoured transport, security, storage cost in a secure facility, etc.), unlike bitcoin, which can be stored on a USB stick, in a cold or hard wallet.
In order to uplift their country’s economy even more, the UK had its Treasury commission a study of cryptocurrencies even more. This was announced to the public on 6 August 2014. It was also to make sure if any regulation needed to be implemented. After publishing its final report in 2018, a consultation on crypto assets and stablecoins was issued in January 2021.
In August 2021, Cuba started to use cryptocurrencies like bitcoin. It was done after they followed Resolution 215. The next big wave for cryptocurrency came in the following month. El Salvador made Bitcoin officially legal in early September 2021 and saw a rise in the number of users. President Nayib Bukele had generated a bill, and when it was passed, Bitcoin was made legal. The bill classified cryptocurrency as a payment option. In the same month, the government of China declared all cryptocurrency transactions illegal. It was the single largest market for cryptocurrency. It completed a crackdown on cryptocurrency. Initially, it banned the operation of intermediaries and miners within China. Cryptocurrency is the talk of the century
Thus we see that what started as an anonymous trial in the 1980s is now a legal tender.
