A Short History of Cryptocurrencies

Cryptocurrencies are digital currencies that use encryption technology.Modern cryptocurrencies are also decentralized systems based on blockchain technology.Blockchain is a distributed database structure first described by a cryptographer named David Chaum in his 1982 doctoral thesis. In the crypto world, the blockchain serves as a public ledger of encrypted transactions held and updated on the computers of thousands of people around the world. Transactions are anonymous but public.Bitcoin is not the world's first digital currency. It is not the first application to use blockchain technology. It's also not the first time public key cryptography has been used to keep data secure. But since it combines all these elements in a single system, it is the first modern cryptocurrency.

Before the development of Bitcoin, there were several examples of online digital currencies, but none managed to attract much attention or gain a foothold in the financial markets. Two examples of such currencies are B-Money and Bit Gold.The internet domain name Bitcoin.org was acquired in August 2008. Today, it continues to be the home page of the world's most widely used cryptocurrency. On October 31 of the same year, a person or organization using the name Satoshi Nakamoto published a scientific paper called Bitcoin: Peer-to-Peer Electronic Cash System. This article is also known as “Satoshi's white paper” in the crypto world.The article introduced the concept of cryptographically secure blockchain technology. Bitcoin has been described as a theoretical open-source digital resource. The term “open source” means that no one owns it and anyone can participate in its use and development.To date, no one has been able to find out who Satoshi Nakamoto is. His identity has been the subject of many legends and theories. It is likely that his identity will always remain anonymous.

In early 2009, Bitcoin software was made available to the public for the first time. Satoshi Nakamoto issued the first 50 Bitcoins and thus launched the practice of crypto mining.It was unrealistic to attribute any real value to Bitcoin in its first year of existence. Developer Gavin Andresen bought 10,000 Bitcoins for $50 and created a website called Bitcoin Faucet, where he donates Bitcoins for fun. The most famous story from this period concerns Laszlo Hanyecz, a software developer who bought two pizzas for 10,000 Bitcoins. This transaction is considered the first cryptocurrency transaction. Calculated at Bitcoin's all-time high price, these two pizzas would be worth over $600 million. But Laszlo never regretted his decision. He believes this is a crucial step in ensuring the growth of the crypto ecosystem.

In December 2010, Satoshi Nakamoto posted his last public message on the popular online forum called bitcointalk. He wrote about some minor details about the latest version of the software. He later remained in contact with some programmers via email, but was never heard from again after April 2011.At the heart of Bitcoin's success, the idea of decentralized digital currency is slowly gaining momentum. As a result, the first alternative cryptocurrencies began to emerge. These currencies were called altcoins because they were alternatives to the well-established cryptocurrency Bitcoin. Most altcoins offer higher speed, greater anonymity, etc. They introduced incremental improvements over the original Bitcoin protocol with features. Litecoin was among the first altcoins, so it is sometimes said that if Bitcoin is gold, Litecoin is silver. There are thousands of cryptocurrencies available today.

In January 2013, the price of a single Bitcoin exceeded $1,000 for the first time. Although the price then dropped rapidly and then remained stagnant for nearly two years before managing to reach $1,000 again, this was a major turning point. Some of the early adopters suffered huge losses during the price recession, causing a lot of negative press for Bitcoin. There was a lot of news being made, and many people first heard of cryptocurrency in the context of these lost fortunes.

The largest cryptocurrency exchange in the market is Mt. It was a website called Gox. It was attacked in January 2014. Hackers stole 850,000 bitcoins and disappeared. Who is responsible for the biggest theft in crypto history is still unknown. Critics said that since cryptocurrencies are based on anonymity and decentralization, it was not surprising that they were hacked and that it was impossible to track down the hackers. In November 2014, the founder of crypto website Silk Road was sentenced to life imprisonment after it was found that illegal drugs made up approximately 70% of the products sold through the website, which relies on Bitcoin to sell to anonymous individuals.

The Ethereum project was launched in 2015. Some consider this to be the first truly useful implementation of the ideas underlying Bitcoin. Ethereum introduced smart contracts, a technology that allows the blockchain to host software programs in addition to crypto funds. Smart contracts have enabled the development of complex, useful applications in finance and other fields.In addition to smart contracts, Ethereum pioneered the idea of hosting multiple currencies. Although Ethereum has its own cryptocurrency, Ether, numerous new token projects have been implemented on top of the Ethereum blockchain.

Bitcoin reached a price of $20,000 dollars in 2017. The number of public trading platforms and crypto exchanges has gradually increased, making it much easier to buy and sell cryptocurrencies. The boom of ICOs has intensified. All this contributed to the rapid growth of the ecosystem. This young technology promised huge profits, and the total market value of cryptocurrencies exceeded $800 billion at the beginning of 2018. All you needed to add a new company was to make sure the words “crypto” or “blockchain” were part of its name.

While everything was going very well, bitcoin suddenly fell in 2018. The growth of the market was not continuous and sustainable for now, so in retrospect it seemed inevitable that the bubble would burst and prices would gradually begin to fall. Many projects collapsed because they were poorly designed or too ambitious.Crypto projects that survived the crash of 2018 seem to have something in common. They are tackling real problems and delivering useful new services using the power of blockchain technology and cryptocurrencies. With more than a decade of technical development behind them, today's crypto experts are finding ways to modernize pre-blockchain businesses by offering new products and services that could not exist without blockchain.

The world is becoming increasingly digital and interconnected, and cryptocurrencies play a key role in providing financial independence to everyone on our planet. Bitcoin and other cryptocurrencies represent the possible future of money, with a growing consensus that it will fundamentally change the global financial system. There are approximately 2 billion prospective consumers worldwide who do not have access to banking services. Cryptocurrencies can offer the opportunity for each of these people to participate in the financial life of the world. What they do and say with this opportunity will change us all forever.