Bitcoin's Price History
The cryptocurrency has undergone several rallies and crashes since it became available. This article offers insight into Bitcoin's volatility and some reasons why its price acts the way it does.
KEY TAKEAWAYS
Since it was first introduced, Bitcoin has had a choppy and volatile trading history.
As an asset class, Bitcoin continues to evolve along with the factors that influence its prices.
Bitcoin was designed to be used as currency in daily transactions.
While Bitcoin is still a cryptocurrency, investors have also used it to store value and to hedge against inflation and market uncertainty.
Due to the growing interest of investors, economists, and governments in Bitcoin, other cryptocurrencies began to be developed around 2017.
Bitcoin's Price History
Bitcoin's Price History
Investopedia / Hugo Lin
The price changes for Bitcoin reflect both investor enthusiasm and dissatisfaction with its promise. Satoshi Nakamoto, the anonymous Bitcoin inventor(s), designed it for use in daily transactions.
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Cryptocurrency gained mainstream traction as a means of exchange. It also attracted traders who began to bet against its price changes. Investors turned to Bitcoin as a way to store value, generate wealth, and hedge against inflation. Institutions worked to create Bitcoin investment instruments.
Bitcoin's price fluctuations primarily stem from investors and traders hoping for an ever-increasing price in anticipation of riches.
BTC Price History Oct. 27 2023
Here's a quick rundown of Bitcoin's price history:
2009–2015
Bitcoin had a price of zero when it was introduced in 2009. Its price jumped from its long-held level of $0.1 to $0.2 on Oct. 26, 2010. Before the year had closed out, it had reached $0.3. In 2011, it started growing past $1, reaching a peak of $29.6 on June 8, 2011; however, a sharp recession in cryptocurrency markets followed, and Bitcoin's price dropped, closing out the year at $4.7.
The year 2012 proved to be a generally uneventful year for Bitcoin, though it did increase by a few dollars; however, 2013 witnessed strong gains in price. Bitcoin began the year trading at $13.3 and crossed $100 by April and $200 by October.
The remainder of the year witnessed historic gains for Bitcoin. It crossed $1,000 in November and closed out the year at $805.9.
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2016–2020
Prices slowly climbed through 2016 to over $900 by the end of the year. In 2017, Bitcoin's price hovered around $1,000 until it broke $2,000 in mid-May and then skyrocketed to $19,345.49 on Dec. 16.
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Mainstream investors, governments, economists, and scientists took notice, and other entities began developing cryptocurrencies to compete with Bitcoin.
Bitcoin's price moved sideways in 2018 and 2019, with small bursts of activity. For example, there was a resurgence in price and trading volume in June 2019, with the price surpassing $10,000. However, it fell to $6,635.84 by mid-December.
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In 2020, the economy shut down due to the COVID-19 pandemic. Bitcoin's price burst into action once again. The cryptocurrency started the year at $6,965.72. The pandemic shutdown and subsequent government policies fed investors' fears about the global economy and accelerated Bitcoin's rise.
At the close on Nov. 23, Bitcoin was trading for $19,157.16. Bitcoin's price reached just under $29,000 in Dec. 2020, increasing 416% from the start of that year.
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2021–2023
Bitcoin took less than a month in 2021 to smash its 2020 price record, surpassing $40,000 by Jan. 7, 2021. By mid-April, Bitcoin prices reached new all-time highs of over $60,000 as Coinbase, a cryptocurrency exchange, went public. Institutional interest propelled its price further upward, and Bitcoin reached a peak of $63,558 on April 12, 2021.
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By the summer of 2021, prices were down by 50%, hitting $29,796 on July 19. September saw another bull run, with prices scraping $52,693, but a large drawdown took it to a closing price of $40,710 about two weeks later.
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On Nov. 10, 2021, Bitcoin again reached an all-time high of $68,789 before closing at $64,995. In mid-Dec. 2021, Bitcoin fell to $46,164. The price started fluctuating more as uncertainty about inflation and the emergence of a new variant of COVID-19, Omicron, continued to spook investors.
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Between Jan. 2022 and May 2022, Bitcoin's price continued to gradually decline, with closing prices only reaching $47,445 by the end of March before falling further to $28,305 on May 11. This was the first time since July 2021 that Bitcoin closed under $30,000. On June 13, crypto prices plunged. Bitcoin dropped below $23,000 for the first time since Dec. 2020. Since the "crypto winter" began in Nov. 2021, Bitcoin dropped below $20,000 by the end of 2022.
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Fortunes changed for Bitcoin in 2023, which saw a stellar rise in the price of the cryptocurrency. Bitcoin started off 2023 at a price of $16,605. It rose consistently throughout 2023, sitting at $34,154 as of Oct. 26, 2023.
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Interestingly, Bitcoin's price trends appeared to mimic those of the stock market from Nov. 2021 through June 2022, suggesting that the market was treating it like a stock. It similarly followed this trend through most of 2023.
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What Affects the Price of Bitcoin?
Supply and Demand
Like other currencies, products, or services within a country or economy, Bitcoin and other cryptocurrency prices depend on perceived value and supply and demand.
If people believe that Bitcoin is worth a specific amount, they will buy it, especially if they think it will increase in value.
By design, only 21 million Bitcoins will ever be created. The closer Bitcoin gets to its limit, the higher its price will be, as long as demand remains the same or increases.
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Bitcoins are created by mining software and hardware at a specified rate. This rate splits in half every four years, slowing down the number of coins created.
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Bitcoin's price should continue to rise as long as it continues to grow in popularity and its supply cannot meet demand. However, if popularity wanes and demand falls, there will be more supply than demand. Then, Bitcoin's price should drop unless it maintains its value for other reasons.
New Bitcoin Securities
Another factor that affects Bitcoin's price also relates to supply and demand. Bitcoin became a financial instrument that investors and financial institutions used to store value and generate returns. As a result, derivatives have been created and traded by investors. This influences Bitcoin's price.
Speculation, investment product hype, irrational exuberance, and investor panic and fear can also be expected to affect Bitcoin's price because demand will rise and fall with investor sentiment.
Cryptocurrency Competition
Other cryptocurrencies may also affect Bitcoin's price. There are several cryptocurrencies, and the number continues to rise as regulators, institutions, and merchants address concerns and adopt them as acceptable forms of payment and currency.
Lastly, if consumers and investors believe that other coins will prove to be more valuable than Bitcoin, demand will fall, taking prices with it. Or, demand will rise along with prices if sentiment and trading move in the opposite direction.
Is Bitcoin a Good Investment?
Bitcoin is a cryptocurrency designed to be used as a payment method. Investors and traders began using it as an investment, as well, but its price is very volatile. This creates a significant amount of financial risk. It is best to talk to a professional financial advisor about your circumstances and goals before buying Bitcoin as an investment.
What Is Bitcoin's All-Time High Price?
Bitcoin reached an all-time high price of $67,566.83 on Nov. 8, 2021.
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What Was Bitcoin's Cheapest Price?
Bitcoin began trading at $.09 in July 2010.
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How Long Does It Take to Mine One Bitcoin?
The rate of difficulty changes. Mining depends on the software and hardware used as well as available energy resources, but the average time to find a block is about 10 minutes.
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Investing in cryptocurrencies and other Initial Coin Offerings (ICOs) is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or other ICOs. Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein.
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PART OF
Bitcoin Price Guide
What Determines Bitcoin's Price?1 of 9
Bitcoin's Price History2 of 9
Bitcoin vs. Altcoin: Which Is Best for Merchants?3 of 9
Why Is Bitcoin Volatile?4 of 9
Bitcoin vs. Litecoin: What's the Difference?5 of 9
Bitcoin vs. Ripple Labs: What's the Difference?6 of 9
Bitcoin vs. Bitcoin Cash: What's the Difference?7 of 9
Bitcoin vs. Ethereum: What’s the Difference?8 of 9
Will Cryptocurrency Replace Fiat Currency?9 of 9
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