Maybe you are familiar with the word “Bitcoin” and maybe you are not. It is occasionally in the news but it is not something than is encountered out in the mainstream world very frequently. Sure some guru level technologists and investors might be discussing it.
So is Bitcoin the only “crypto currency” out there?
I first started hearing about this in about 2008, and by 2010 I was engulfed in news about it. This was primarily in the “hacker sub culture world” so it was very niche. At that time, it had no practical real-world purposes, and no real “backing” – it was primarily the focus of some tech, science and university research. It was about 10 cents per bitcoin, and anyone could mine some up in short time.
Back then, the word on the street was, that there was this technology – a mechanism where two people could exchange something of value using this kind of “open, decentralized” system. The hacker community really liked it because it kept “transactions” outside of government control, which is important for some philosophical reasons that drive the community. One very intriguing element was this exchange could be done in a de-facto “anonymous” way. Another very interesting element was that anyone could contribute their own processing cycles to “mine” this stuff, thereby essentially “minting” new coins they could use to exchange! It was a novel idea, but at the time only that – a novelty.
I recall seeing Bitcoin at around $1.00, then shooting up to $30 before crashing back down. It was considered volatile without any practical real world uses. It was predominantly used on the dark web for sketchy transactions. It was also not easy to “buy” or hold. Back then, the “exchanges” – places you would wire money from your bank account and then have access to bitcoin, well these exchanges often operated in Russian block countries, and frequently would vanish – along with your bitcoin holdings or cash! It was very dangerous to deal in this stuff back then. People lost a lot of money.
I remember looking at bitcoin when it was in the $300’s around 2013 and saying “that’s crazy!” then the price spiked up to over $1,200+ and it was amazing! So many people felt so bad for not buying it when it was $1.00 – people basically became overnight millionaires.
When it spiked, it had to do with China. When it crashed, it had to do with China. From $1,200 to around $500 was a hard crash it took shortly after capping out. People were shocked! So many people lost fortunes, either because they made a late investment and lost money, or because they stayed invested after the spike, believing they were rich, then saw that evaporate.
The price of bitcoin jumped around alot the next few years and it was wild because it would go from $700 – $300. However so many people still had to hold it, waiting for it to reach that magic $1,200+ mark again! Something that did not help during this time was the crash of one of the most widely trusted, most highly invested in exchanges – Mt Gox. Everyone followed Gox, it was the go-to exchange for trading. Well it closed up one day unexpectedly.
Not just Gox either. Exchange after Exchange did the same. Cryptsy is another example. I lost coins when it shut down.
Personally, I ran a fair amount of crypto-trades during that time period, trading in a variety of coins from Bitcoin to Darkcoin, Nextcoin, Dogecoin, Litecoin, Ripple, and many others.
I also used my bitcoin to pay for things online, like Fiverr gigs and even to send tips.
Bitcoin steadily started growing. Suddenly it reached the $1,200 mark, but just didn’t stop. It went on to exceed $2,500!
What drove that spike? Well several things. Part of it was the emergence of this technology as a resource investors have the stomach for, and organization around crypto currency has grown greatly. Japan passed some laws related to it, which permitted better banking with it there, and that opened the door for a great deal of Asian investment again. The price is driven in large part by Asian speculation right now.
So is Bitcoin the only “crypto currency” out there?
By all means, no. It is not the only one! There are probably hundreds out there, but several dozen predominantly trade on many of the crypto exchanges that come and go over the years.
The second most traded, and second most valued currency currently on the market is called Ethereum. What is it? Well, it is a 2.0, 2nd generation coin. The price of Ethereum has jumped from $20 to $250 in just a couple months. That’s even better than bitcoin.
What will happen next? We don’t know for sure. People are speculating Crypto Currency is here to stay, and that it will continue to rise in value. So far, historically it has been performing quite well, however it has a level of volatility and certain pitfalls that make it’s future quite difficult to predict. Only time will tell. In the meantime, I’m holding my coins, and plan to continue buying.