It’s essentially nerd money.
About four years ago I wrote copy for an infographic about bitcoin. I didn’t get paid in bitcoin, but now I wish I had. At the time, it was still relatively new . . . five years old or so. It started with a bunch of nerds, especially one nerd, the Kaiser Soze of nerds, Satoshi Nakamoto (not his/her/their real name, because of course). He/she/they created a digital currency governed by no one, backed by nothing but its code, and worth nothing but the digits it wasn’t even printed on. It was nothing but digital code, strings of it. The initial code block featured 50 bitcoin, worth roughly 50 bits of zilch. But hey, it was fun to have nerd Monopoly money to trade with each other whenever they needed to pay each other to keep track of their codes.
Only, it was genius. The idea was that counterfeiting would be impossible, ever generation of new bitcoin, every single transaction of any kind, would be tracked on everyone’s computer. It rolled out in the beginning of 2009 and, with a few hiccups along the way, has been consistently rising in value and in the extent that it is being taken seriously by international consumers, markets, investors, and retailers. It took a couple of years for the value to build substantially, but the value of the bitcoin reached the same worth as the US dollar by spring of 2011. When I first researched bitcoin in 2013, it spent the year fluctuating from $100 to $1200 and every point in between, normalizing around $600 or so. Its value has been on a bit of a roller coaster ride over the past several years, but still with a general climb. As of today, the value is over $1,200, making this quite possibly the worst time to buy.
Or, it’s just starting to reach the popular level, making it a better time than any. How should I know, I’m no economist.
If it’s still not making sense, here’s a link explaining bitcoin so a five year old could understand it. (Keep in mind, “so a five year old could understand it” is nerdspeak for “so a middle-aged college grad kind of gets it.” Be warned.)
It’s all just very interesting to me, even if it makes my brain hurt.
So here’s a little bitcoin trivia: In 2010, how much did Laszlo Hanyecz pay in bitcoin for two pizzas from Papa John’s? (Price is Right rules apply; leave your answers in the comments, and I’ll keep them hidden until I reveal the answer.)