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(Please note- the following article should not be considered as legal or financial advice. )
It doesnt matter if its 2014 or 2019. Bitcoin is still the most important vital sign that everyone in blockchain check to assess the health of the cryptocurrency market.
Dropping from the highs of 2017 to the lows of 2018, just to bounce back up to $13,000 in late June 2019, the price of Bitcoin still dominates public discussion. Just look at any crypto news resource, the finance section of major news sites, or even Reddit, and youll see all assortment of news, discussion, and speculation about it.
Bitcoin still reigns supreme. Whatever happens to Bitcoin, affects almost 99% of the altcoins out there. Bitcoin, after all, was the very first cryptocurrency on the market. It has unwaveringly remained the crypto that most people know, talk about, and invest in.
Its only natural that people are fascinated by its price! If youre one of those people, and youre interested in learning about all of the ins and outs of BTCs price such as its history, the factors that influence it, and how to keep track of it, youre reading the right article.
This guide will give you a crash course in some of your most burning BTC price questions. Read on to discover more!
In order to understand Bitcoin price today, as well as its possible future price timeline, it is useful to take a look back on the history of Bitcoin price. While it would be impossible to list every event since its invention that had an impact its price, below, weve highlighted the most notable ones.
Lets start right at the beginning, October 2008. This was the month the creator of Bitcoin, Satoshi Nakamoto, published a white paper in an online cryptography mailing list calledBitcoin: A Peer-to-Peer Electronic Cash System. In their piece, they highlighted the necessity for a new means of the payment system to tackle the long-standing problems of traditional currencies and financial institutions.
Satoshi outlined that the solution to such problems lays in their invention of a digital, decentralized currency called Bitcoin. They envisioned that Bitcoin would act as an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party.
But while Satoshis proposal was completely groundbreaking the likes of which the world had never seen before it didnt make anywhere near the type of impact that one would expect for such an innovative creation. The reason for this is that the online cryptography mailing list the paper was published on was incredibly niche targeted at those interested in cryptography (all the way back in 2008, mind you!).
Notice that we used the gender-neutral pronoun, they to describe Satoshi Nakamoto? Thats because the identity of Satoshi is still a complete mystery we dont know for sure about their gender, nationality, age, or even if they are one person or a group of people. Unbelievably, they have managed to keep their anonymity all of this time! This has caused rampant speculation and investigations to try to uncoverwho therealSatoshi Nakamotois.
It was on January 3, 2009, that Bitcoin was brought to life when Satoshi mined the genesis block (block number 0), allowing him to amass a mining reward of 100 bitcoins. The first ever bitcoin transaction took place on January 12, 2009, which was a transaction from Nakamoto to programmer Hal Finney.
Finney was an ardent supporter and contributor to the Bitcoin network from the very beginning, so was rewarded for his hard work with 10 bitcoins.
In these early days before Bitcoin was listed on an exchange, the price of mined bitcoins was determined via individuals trading BTC on a Bitcoin forum. There was no mandated price to look to so it was wholly a negotiation between the seller and buyer to come to an agreement over BTCs worth. To exemplify just how niche BTC was in those days, consider that in March 2010, a user by the handle SmokeTooMuch unsuccessfully tried to auction off 10,000 bitcoins for $50.
There was, however, a service calledNew Liberty Standardthat allowed BTC to be bought via PayPal. In a fact that will make you want to travel back in time machine to this period, the first recorded exchange rate they published (on May 10, 2009) was 1309 BTC per 1 USD. With todays exchange rate (August 30, 2018), a $1 investment in BTC back then would be worth over $9,000,000 today!
A glimpse at Liberty Standards BTC prices per $1 USD.(Image credit: Liberty Standard /WayBack Machine)
Interestingly, New Liberty Standard calculated their BTC prices by dividing $1.00 by the average amount of electricity required to run a computer with high CPU for a year. This amount, 1331.5 kWh, was multiplied by the average residential cost of electricity in the United States for the previous year, $0.1136, divided by 12 months divided by the number of bitcoins generated by my computer over the past 30 days.
On March 17, 2010, the very first BTC exchange, (now defunct), opened for trade. For the first half year after it started trading, BTC remained below 14 cents. However, in the summer of 2010, the cryptocurrency started gaining momentum, with this triggering a movement in the price listed on exchanges.
It was during this time, on May 22, 2010, that a particularly noteworthy transaction took place one which has already cemented itself firmly into Bitcoin folklore. Dubbed the Bitcoin pizza, a Florida programmer by the name of Laszlo Hanyecz transacted what is believed to be the very first real-world bitcoin transaction. He purchased two pizzas delivered from Papa Johns for a cool 10,000 bitcoins. At the time of writing, using todays bitcoin exchange rate (February 2019), those two pizzas would be worth a staggering US$40 million!
The Bitcoin pizza transaction is still celebrated every year
On July 12, 2010, BTCs price increased by 900% from $0.008 to $0.08 for 1 bitcoin in just 5 days. Five days later, the infamous cryptocurrency exchange Mt. Gox was launched.
On August 15, 2010,the first and only major security flaw in bitcoins history was exploitedwhen a vulnerability in the bitcoin protocol led to a staggering 184 billion BTC generated in a transaction. Although the transaction was identified, the bug fixed, and the transaction erased from the transaction log (as well as the network forking to an updated version of the bitcoin protocol), the hack caused the price of BTC to drop dramatically.
In October 2010, BTC passed one bit for the first time, that is, $0.125. One month later, not only did Bitcoins share capital reached 1 million USD, its exchange rate on MtGox reached USD$0.50 per BTC.
On February 9, 2011, the price of one BTC reached parity with the US dollar on MtGox for the first time. Bitcoin experienced its first major bubble on June 8, 2011, when it hit $31 and subsequently, its first major price drop, when it plummeted by 68% in the days following. The price would keep falling for the rest of the year, finishing the year at around $2. It would take another 2 years for its price to hit Julys all-time high again.
For more info about the biggest Bitcoin crashes, take a read ofthis Forbes article.
2011 was also the year alternative cryptocurrencies to Bitcoin known as altcoins began to populate the cryptocurrency landscape. Created from bitcoins open source code, examples of the altcoins that emerged include GeistGeld, I0coin, Fairbrix, Namecoin, and SolidCoin. Notably, this was also whenLitecoin was created, a cryptocurrency marketed as the silver to Bitcoins gold. The emergence of competitors via the advent of altcoins meant that BTC would never again have a total monopoly of the market.
After several successful hackings, including a theft on Linode of around 50,000 BTC in March 2012, and evenan investigation by the FBIin April 2012, the Bitcoin Foundation was established in September 2012 with the initial aim to revive the cryptocurrencys reputation and further its development and mass adoption. Since then, the foundation has helped to positively steer the public, political, and media discourse about Bitcoin. These three realms which we identify in the section below as having an influence on bitcoin price.
The front page of the FBIs Intelligent Assessment of Bitcoin.(Image credit:Wired)
In October of the same year, the global bitcoin payment service provider BitPay reported having more than 1,000 merchants accept BTC with its services.
Like the years before it, in 2013, a number of events positively and negatively impacted the price of BTC over the course of the year. In terms of highs, in February, Coinbase reported selling US$1 worth of BTC in a single month at over $22 per coin. By the end of March, Bitcoin capitalization was over 1 billion USD. The first Bitcoin ATMs were introduced in October, opening the door for greater public adoption.
As for lows, in April, BTCs price dropped 71% from$233 to $67 in just 12 hours. Another event that initially seemed right at the top of the list of lows was the FBI shutting down the online black market Silk Road in October and seizing around 26,000 BTC from user accounts (worth around $3.6 million at the time). Bitcoin was used as the primary means of payment on Silk Road, so its closure marked an end to a significant avenue of actual BTC usage.
Few could have foreseen that the closure of Silk Road would contribute to an unprecedented growth in BTCs price.(Image credit:CoinMarketCap)
Interestingly, while most pundits expected its closure to result in a massive price drop for BTC, itdid the opposite. Although it fell from $125.49 on October 1 to just under $100 the next day, by the third it had already started to recover to $116.82. The price kept rising, and rising for the rest of the year eventually hitting a new all-time high of $1,122 on November 30. The high didnt last, however, with the price more than halving in mid-December, timing that was concurrent with the Peoples Bank of China prohibiting Chinese financial institutions from using BTC.
The year 2014 will forever be marred in Bitcoin history as the year when the Mt. Gox incident took place. As mentioned above, Mt. Gox was launched in 2010. It saw great success by becoming both the leading bitcoin exchange and the largest bitcoin intermediary by 2013/2014 when it was handling more than 70% of all bitcoin transactions worldwide.
However, in February 2014, the exchange reported thatapproximately 850,000 bitcoinsbelonging to its customers were missing in February 2014. At the time, the loss amounted to more than $450 million. As a consequence, the exchange was forced to shut halt bitcoin withdrawals.
It was unclear then how exactly the bitcoins went missing. In April 2015, the security company WizSec came to the conclusion that most or all of the missing bitcoins were stolen straight out of the Mt. Gox hot wallet over time, beginning in late 2011. It was, in fact, not the first issue the exchange had faced since its establishment, with all range of problems from lawsuits and a warrant issued by the US Department of Homeland Security to seize money, to major withdrawal delays.
All in all, the Mt. Gox incident shook the confidence (and emptied the pockets) of a great number of cryptocurrency traders at the time. With reduced confidence and substantial losses, the price of bitcoin dropped the $500 range, before recovering to the $600 to $700 range. The incident is still referenced as an example of the inherent problems with cryptocurrency exchanges, and thus cryptocurrency in general, and feeds into the perception by the general public and media that bitcoin is too complex, problematic, and niche to be widely adopted.
2014 was also the year Bitcoins biggest competition to date in terms of market cap burst onto the scene: Ethereum.
2015 overall was a relatively quiet year, with no major highs or lows, nor events that significantly swayed its price. BTC experienced a slow but steady price growth by starting off the year at $315, and ending at $426. Initially, its price continued to steadily rise into 2016, albeit at a slightly faster pace than the previous year. Around June, BTCs price picked up substantially, where it hit $772, only to fall again. From August until December, BTC had a bull run with the price sharply rising mid-December to end the year on $953.
As far as BTC goes, 2015 and 2016 were both relatively steady years of growth.(Image credit:CoinMarketCap)
2017 was a very positive year for bitcoin developments with both greater user and business adoption. For instance, 4.6 times more Japanese online stores began to accept BTC over the past year, and the cryptocurrency exchange Poloniex had experienced an increase of more than 600% of active traders online from January to May, with 640% more transactions.
It was also the year many lawmakers and financial institutions worldwide signaled their greater support of the cryptocurrency. For example, Japan legislated to accept BTC as a legal form of payment, and Norways largest online bank integrated BTC accounts.
From January to April, the price rose steadily from $965 to $1316. On May 21, BTC surpassed $2000 for the first time, and from there, continued to quickly gain traction at price.
On August 1, the Bitcoin network split in an event now known as theBitcoin Cash hard fork. Although many were expecting this to lead to a crash in BTCs price, following the split, it fell slightly from $2874 to $2719. It quickly recovered, reaching a new ALT of $3000 on August 6, and surpassing $4000 by mid-August. At the start of September, it was $4710, but its bull runs briefly impeded by the announcement of Chinas ICO crackdown on September 4, which resulted in a dip from $4531 to $4308.
November and December were the glory days for BTC.(Image credit:CoinMarketCap)
From October to the end of the year, it was a case of one ATH replacing another. At the end of October, $6000 was reached for the first time, with $7000 following in early November. On November 20, a new ALT of $8000 was reached, demonstrating a quick recovery from a crash of $5760 just days before.
The rest of the year would go down in history as Bitcoins biggest bull run. What caused the bull run is attributed to a number of factors, including greater media attention, an increase in public interest fueled by a fear of missing out (FOMO), greater institutional interest, and the introduction of BTC futures trading. At the start of December, $10,699 was hit, and then the price continued to increase by thousands every couple of days until it hit its all-time high to date of $19,429 on December 17.
The high was not sustained, however, with the price dipping in the following days, going back down to $13,311 on December 24, a correction that essentially shaved billions of dollars off BTCs market capitalization. Ironically, the decline is considered by many, including the Federal Reserve Bank of San Francisco, to have been a consequence of thelaunch of Bitcoin futures trading. The year was finished on $13,313.
A year to date view of BTCs price.(Image credit:CoinMarketCap)
BTC started the year off relatively strong at $14,112 and proceeded into a bull run that peaked on January 7 at $17,462. As you can see from the chart above, that peak represents this year to dates highest price.
Just a day later, on January 8,CoinMarketCap removed the prices of South Korean exchanges from its calculationswithout warning. Consequently, a substantial selloff was triggered, causing the price to lose thousands in the days following, dropping to $13324 on January 11.
On January 26, CoinCheck, one of Japans most popular exchanges, stopped all withdrawals to respond to a possible hack. The news was widely reported in the media, which was perhaps acontributing factor to BTCs price falling by 3.4%.
While in early March, BTC was enjoying a price range in the $10,000s to early $11000s, it dipped sub $10,000 following the SECs March 7 announcement that online platforms trading digital assets must register with them.
2018 has also seen some interesting announcements regarding the advertising of cryptocurrencies. These announcements are widely considered to have had an impact on the crypto market as a whole. For example, on January 30, Facebook announced a blanket ban on crypto ads. This was followed by Google announcing a ban on crypto and ICO advertisements on March 14, and Twitter on March 26. After all three announcements, BTC price dropped.
A number of significant hacks occurred in 2018, all of which have been said to have caused substantial price declines. Notable hacks include the aforementioned CoinCheck hack and the hacking of South Korean exchange Conrail on June 10, which contributed to BTC declining by 10%.
One event that had many traders speculating over BTC price were the proposals for two bitcoin ETFs to be listed on the New York Stock Exchange. Those anticipating the proposal to pass speculated that it would lead to a massive bull run. In the end, the proposals were rejected, shutting the door on the bull run that many hoped would stimulate the price above the $6000 to $9000 range we have seen for most of the year.
Coupled with an increasing focus by authorities to regulate or outright ban Bitcoin,an acrimonious Bitcoin Cash hard forkcaused a bitter and public feud between Roger Ver and Craigh Wright and tremendous market uncertainty. BTCs price continued to slide down as many investors seemingly gave up on the crypto industry. Hitting a low of $3130 during mid-December, Bitcoin closed 2018 out in miserable shape,clinging to life at $3831.
With the Crypto Winter in full effect during the end of 2018, few analysts and even HODLers anticipated anything but another tough year for Bitcoin. However, as Lauryn Hill sings, After winter, must come spring, and this was prescient for Bitcoin too.After 11 brutal months,Bitcoins price started climbing again. And climbing, and climbing.
By the 1st of April 2019, Bitcoins price spluttered over the $4,000 mark. What was to follow would have sounded like an April Fools joke if it wasnt true. By the end of April 2019, after a very positiveConsensus conference weekin New York, BTC traded at over $5,200. By the end of May, it skyrocketed to $8,600.
Bitcoin price history: January to August 2019 (Source:
Finally, on June 22, 2019, Bitcoins price once again broke the mystical 5-number barrier, cracking $10,000 effortlessly and powering up to over $13,000 in a matter of days before running out of steam. The bull market was officially back!
What was the reason for Bitcoins great reversal of fortune, so to speak? While everyone speculated and conspiracy theories abounded once more, in reality its hard to point out one specific event or cause. More likely, a combination of factors helped to revive Bitcoin.
Bitcoins hash rate and daily users (1million by June 2019) kept increasing, showing its potential and increased stability as an investment alternative.
Industry and government news were also predominantly positive, with institutional investors and politicians singing digital assets praises and big names likeJP Morganand Facebook jumping on the crypto bandwagon with their JPM andLibra corporate cryptocurrencies,which legimitised the potential of Bitcoin.
Bitcoins resilience in the face of a prolonged bear market proved to investors that BTC had matured and was undervalued. With a trade war looming between the US and China and other macro-economic factors causing mayhem on traditional markets, Bitcoin suddenly became increasingly appealing as asafe haven asset.
Finally, some analysts view Bitcoins bull run as a natural reaction to the coming Bitcoin rewards halvening in 2020. Usually when Bitcoins mining difficulty is set to increase, its price shoots up a year beforehand.
At the time of this article update (5 August 2019), Bitcoins price is picking up momentum once again and changing hands at over $11,000.
Unfortunately, its resurgence has seemingly decimated the altcoin markets value at the moment, with almost all other digital assets suffering huge drops in satoshi (vs BTC) and fiat value (vs USD). Investors are especially disappointed in Ethereum and Litecoins current performance, considering the corresponding hike in value during Bitcoins 2017 bull run.
So what does the rest of the year hold for BTCs price? As we explore in the final section of this article, Bitcoin Price Predictions, no one really knows. But as youll read, that hasnt stopped people from making predictions. There is once again a lot ofbullish sentimentin the market.
One thing is certain though, Bitcoins price will remain volatile. With increasing regulation coming in, such as the Financial Action Task Force formalizingthe Travel Rulefor digital exchanges worldwide, trade wars happening, Bitcoin Halvening drawing nearer and scams and hacks continuing to wreak havoc on investors confidence at times, were certainly set for another bumpy ride. Were just not sure if its going to be upwards or downwards!
If youre interested in learning more about Bitcoins major milestones since 2008, we recommend checking out the following resources we referenced to write the above section i.e. the Bitcoin History page on Bitcoin Wiki, the History of Bitcoin on Wikipedia, and Investopedia If You Had Purchased $100 of Bitcoin in 2011.
When it comes to BTCs price, there is not one factor that single-handedly influences its price. Rather, there is a multitude of factors that may influence its price at any one time. Listed below are some of the most notable:
One intangible, but nevertheless the critical factor that influences Bitcoin price is its first mover advantage. First mover advantage is a term used to describe the set of advantages that come with being the pioneer in a given industry.
As Bitcoin holds the title of the worlds first cryptocurrency, it has a number of unique attributes (compared to cryptocurrencies that came after it) that work together to support its growth in both adoption and price. Examples include its:
So, how do these attributes impact its price? Bitcoin is able to leverage them to instill greater investor, merchant, and media confidence in it as a cryptocurrency. However, there is also a flip side its set of first-moverdisadvantages. As many of bitcoins so-called shortcomings are associated with its early creation, being the first crypto on the block can be said to have a negative influence on its price. For instance, with additional media attention and public awareness also comes with additional scrutiny and criticism.
Moreover, many of the problems bitcoin faces, such as its lack of scalability, were not foreseen at the time of its creation. Conversely, cryptocurrencies that have come after it has had the opportunity to address these problems in their own design. By implication, anyone concerned about Bitcoins problems may choose to invest in these other cryptocurrencies instead.
Want to learn more about Bitcoins first-mover advantage?
We thoroughly explain what it is and its implications in our mammoth guide, What is Bitcoin?.
Given that it is the cryptocurrency which is not only the most well-known to the public but also the most written and spoken about in the media, Bitcoin price is also impacted by news cycles.
You can think about the impact the news has on its price as similar to how news stories impact stock prices. When there are numerous news outlets and stories reporting positive news about BTC and/or cryptocurrencies in general, the market may see a positive impact. One reason why is that positive news can cause what is popularly known as fear of missing out or FOMO. That is when people think that its their last chance to buy BTC at a certain price, and subsequently panic buys causing the price to rise.
In contrast, when reporting takes a doom and gloom angle on either bitcoin or cryptos, the market may see a negative impact. In crypto, this effect is referred to as fear, uncertainty, and doubt, or FUD for short. FUD describes when people sell off their crypto due to feelings of uneasiness causing the price to fall.
Its important to note the use of the word may above, as the influence of the news cycle on cryptos shouldnt be taken as an absolute but instead be considered as one out of many factors that may impact the price.
A word of warning about looking to traditional news outlets for insights about the price of BTC, asPedro Febreropoints out, many of the experts who report on cryptocurrency markets have an understanding of traditional financial markets, but dont understand the particulars of cryptocurrency markets to accurately report on them.
If youve been following Bitcoin price changes with a sharp eye, you would have recognized the substantial impact that regulation laws can have on its price. Regulations impact BTCs price in a more quantifiable way than many other factors as they either limit or expand citizens access to cryptocurrency and blockchain technology.
It is notable that up until 2017, Bitcoin was at large, unregulated. The lack of governmental intervention allowed for the market to grow in an unconstrained way. However this changed in 2017 when the popularity of cryptocurrency saw new heights, and the governments of many countries scrambled to issue legislation and regulations to assert greater control. Since then, the rate at which governments are issuing regulations is increasing.
This is notable as whenever there have been rumors or actual implementation of regulations that impact the trading of cryptocurrency in countries considered major crypto hubs, the market is perceivably affected.
Some well-known examples of the impact of regulations include:
BTC fell 10% to sub $10,000following the Security and Exchange Commision (SEC)s announcement on March 7, 2018, that online platforms trading digital assets that are considered securities need to register with the agency.
Black Tuesday: Regulatory uncertainty in China and Korea saw both BTC and altcoin prices drop by 40% on January 16, 2018
Japans accommodative approach to cryptocurrencieshas continued to contribute to price growth in a time of increasing regulations from other Asian countries
For more insights about the way regulation affects the market,check out this Coin Telegraph article.
The level of utility BTC has both online and in the real world is one factor that affects its price. If individuals, as well as businesses, have more opportunity to make transactions with BTC in an easy and convenient manner, they will be more likely to adopt it as a technology to use in their daily lives. And with greater adoption, will come greater demand. Combine this with the fact that the total supply of BTC is capped at 21 million, and you have a perfect formula for price growth.
So how do you create greater utility? Greater levels of merchant adoption. One of the common criticisms about Bitcoin, and cryptocurrencies, in general, is the relatively low level of merchant adoption and therein real world usage. Cryptocurrencies have still yet to reach mainstream merchant adoption, so the number of merchants that accept crypto payments for their products or services is still relatively limited.
That being said, Bitcoin leads all other cryptocurrencies in the number ofmerchants that accept it as a form of payment. This is in part due to its first-mover status, as highlighted above, but also because of its very nature as a digital currency (keep in mind that not all cryptocurrencies are designed to be used as digital currencies akin to fiat).
If youve been in the cryptocurrency game for a while, or have just started out, youve probably already encountered the overall lack of knowledge and ignorance the general public has about Bitcoin.
Whether its someone making an absolute statement about Bitcoin being a complete scam, and only a tool for criminals, or someone who doesnt properly understand the particular features, functions, or technicalities of Bitcoin, its clear that general misconceptions about Bitcoin are still rampant in the general public.
This has a considerable impact on the price of Bitcoin. Ignorance, after all, stymies progress, so if general discourse around Bitcoin is still primarily negative, adoption levels will be affected, and in turn, bitcoin price.
A factor that is predicted by many to cause the price of Bitcoin to drives up in the future is Bitcoins market cap limit. Bitcoins maximum supply of coins is 21 million bitcoins. That is, there will only ever be 21 million coins ever mined, and after theyve all been mined thats it.
Bitcoins upcomingmining rewards halvening in 2020will make BTC even scarcer, and the price likely higher.
At the time of this articles first publication (August 30, 2018), 17,237,100 bitcoins have already been mined. This represents 82% of the total supply.
It is reasoned that as the amount of BTC yet to be mined becomes scarcer, and demand increases (due to a number of factors, including its growing scarcity), more pe