Bitcoin white paper turns 13 years old: The journey so far

Just as the world is still dealing with an unprecedented memecoin mania trend, a global pandemic and inflation fears, the 13th birthday of Bitcoin (BTC), white paper has crept up.

Satoshi Nakamoto published the Bitcoin whitepaper to a Metzdow cryptography mailing list on October 31, 2008. Metzdow’s mailing list was managed by a group cypherpunks. It contained ideas that could be used to create digital currency. Some of these ideas were even cited in the Bitcoin whitepaper.

Satoshi’s whitepaper was posted in a message entitled “Bitcoin e-cash papers” in which Nakamoto explained how his digital currency is completely peer-to-peer (P2P), and that transactions can only be made by trusted third parties. Bitcoin solved the double-spending issue by creating a peer to peer network. Bitcoin allowed network participants anonymity and was secured by a proof of work (PoW), consensus algorithm.

The white paper was not received in the manner people expected it to be. Now, they know what they know. A few people only saw Nakamoto’s email and responded with their concerns and thoughts about Bitcoin.

Leo Matchett (co-founder and CEO, Decentralized Pictures), a non-profit organization supporting independent filmmakers spoke to Cointelegraph. He said that the Bitcoin whitepaper “is the genesis for a new era of monetary sovereignty” and that “Satoshi stood upon the shoulders of giants and solved issues that those before him could not.”

Matchett stated that the white paper was “truly the beginning of an era for global monetary systems” because it “brought forth a belief that centralization has more value that decentralization.” In fact, Bitcoin sought to solve many problems, including counterfeiting and high on-ramps.

Bitcoin Mining

The white paper was posted to the cryptography mailing list. Slowly but surely, the discussion around the document grew. In the early part of 2009, the Bitcoin network was launched. Hal Finney was a cypherpunk who worked for the PGP Corporation in developing encryption products.

Hal Finney, a well-known cryptocurrency figure, was involved in the first Bitcoin transaction. He also became the first person to run a copy through a node of the network after Nakamoto. Finney said that he was now “running bitcoin” after setting it up.

Bitcoin running
— Halfin (@halfin), January 11, 2009

In a forum post, the cypherpunk described his relationship with Satoshi. He said that he had started mining BTC on block 70-something, and that Satoshi then sent him 10 BTC to see if the network was working.

There was no demand at the time for blockchain space, so the transaction was processed successfully with a 0 BTC fee. The transaction was a way to fix bugs in BTC’s early days, even though the 10 BTC were not worth anything at the time.

The first Bitcoin transaction proved that the network was functional. While there were still many steps to go, it was a significant step forward. One year later, the first commercial Bitcoin transaction would take place in 2010.

$600 million+ for two pizzas

Laszlo Hanyecz, a developer from Bitcointalk, posted a May 18th 2010 post offering 10,000 Bitcoin for “a couple of pizzas.” Hanyecz would pay another member the coins if he got two large pizzas. These could be homemade.

This post was met with suspicion as 10,000 BTC were not worth two pizzas or even close to it at that time. Hanyecz reported that he had “successfully exchanged 10,000 bitcoins for pizza” on May 22 after a follow up.

Despite Bitcoin’s low price and small community, one user noticed that this was a significant milestone. It is now known as the “Bitcoin Pizza Day.”

The first Bitcoin transaction resulted in the creation of an ecosystem worth more than $2 trillion. It also proved that Bitcoin can be used for many purposes that are not obvious. Bitcoin was first used as a medium of exchange.

multi-trillion dollar industry

Over time, the price of cryptocurrency would rise due to adoption and partly because speculators were looking to make a profit from its volatility. New businesses were formed in this large asset class.

Miha Grcar from Kraken’s global business development, spoke to Cointelegraph. She said that no one could have foreseen the tsunami of change caused by the publication of a nine-page PDF.

Grcar stated that the Bitcoin white paper outlined a vision for a cryptocurrency that could be used to store value and as a medium of exchange without centralized control. According to Grcar, it is still not fully realized.

“It was a breakthrough of historical significance and magnitude, which we are only just scratching the surface of thirteen years later.”

He said that Bitcoin was the catalyst for a paradigm shift that now underpins multi-trillion-dollar industries and shows the world that there is a better way. “Sovereignty and finance can co-exist without the corrupt socio-economic systems that are ridden with insiders and cronies.”

BTC’s value wasn’t always clear, as was evident from the first Bitcoin transaction. Popular media outlets and analysts have declared the cryptocurrency “dead” more than 400 times.

According to Cointelegraph Markets Pro, Bitcoin’s market capital is now at $1.16 trillion. Although most people wish they had known about Bitcoin in 2010, 2011, and were able to invest in it to build wealth, many would not have been able to see just how large BTC would become.

In May 2011, Greg Schoen, an early Bitcoin investor, published a famous tweet in which he expressed regret at selling 1,700 BTC at $0.30 after he got them at $0.06 when the cryptocurrency was trading at $0.06. He could have sold his coins for $8 each. His 1,700 BTC would be worth more than $104 million, as one BTC trades above $61,000. It is a pity.

I wish I would have kept my 1,700 BTC at $0.06 rather than selling them at $0.30. Now they are $8.00 #bitcoin
— Greg Schoen (@GregSchoen) May 16, 2011

The rise of Bitcoin has been supported by a vibrant industry that is full of innovation. Already, cryptocurrency exchanges started trading on the Nasdaq exchange. Institutional investors have also recognized that BTC can be used as a hedge against inflation and diversify their portfolios.

El Salvador was the first country to accept Bitcoin as legal tender earlier this year. The country’s Bitcoin Law officially came into effect on September 7. El Salvadorans have the ability to use the cryptocurrency via a Chivo wallet that was launched by the government. It uses the Lightning Network, which is a layer-two scaling method.

Speaking to Cointelegraph, Javier Moro, chief product officer at Latin American cryptocurrency exchange Bitso, noted that El Salvador’s move was “rooted in hope for a better future for El Salvadorans,” and its success will depend on the spread of cryptocurrency-related knowledge in the country.

There is more to come

In October, the United States launched the first Bitcoin exchange-traded funds (ETF). The ProShares Bitcoin Strategy ETF started trading on the New York Stock Exchange under the ticker BITO. In its debut, it was the second most traded fund.

Ron Levy (CEO and cofounder of the blockchain consulting firm The Crypto Company), stated in a statement that the Bitcoin whitepaper “set the foundation for what would become an industry decentralized beyond anything anyone believed was possible.”

He said that the next step in this space is “clear laws, regulations around what can be done with cryptocurrency currency.” However, it’s not clear how this will turn out as established mechanisms continue to resist new technological advances.

Brittany Laughlin is the executive director of the Stacks Foundation. She said that Bitcoin has evolved from being a store-of-value. It’s now possible to create smart contracts on Bitcoin and welcome the millions of BTC owners to the worlds of DeFi, NFTs, and true ownership.

Satoshi Nakamoto allegedly predicted that additional blockchains would use tokens (which they called “domain objects” at that time) to represent ownership of assets. Satoshi used the example of a token that allowed one to have a domain for a period of one year.

Finney: “Satoshi…are you supporting the idea that additional blocks chains would each create their unique flavor of coins which could trade with bitcoins on Exchanges?” Satoshi: “Right…domain objects, domaincoins?” could be the right to own domains for one year.” pic.twitter.com/ZZBUwV65pS
— Balaji Srinivasan (@balajis) July 2, 2021

Grcar stated that humankind is only scratching the surface with Bitcoin and blockchain technology. It is possible that Bitcoin’s creator Satoshi Nakamoto thought of the current developments.

The Bitcoin whitepaper has proven that the concept of a decentralized network is possible and can be understood in a nine-page document.

Although it’s not clear if more countries will adopt Bitcoin as legal tender in future or if interest for Bitcoin ETFs may wane, it seems clear that Bitcoin will be around and continue to serve as both a store-of-value and medium of exchange. This is only 13 years since the original idea was introduced. Think about what the next 13 years will bring.

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Eileen Wilson

Eileen Wilson –Technology and Energy My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of topmagazinewire.com with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.

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