Refreshing in: 60s | Mon, Oct 18, 07:38PM GMT
Bitcoin was worth eight cents in 2010, but today it’s worth thousands. Spending about $7 on bitcoin in 2010 could mean you’re a millionaire now. But bitcoin’s value doesn’t always go up. Imagine if you had bought a thousand bitcoin in late 2013 — when the cryptocurrency was worth more than $1,100 a pop — and then watched its value plummet below $200 in just over a year.It’s tough to predict exactly how much bitcoin will be worth in the future. Let’s explore how bitcoin has grown over the years and where it might be headed.
However, it’s a notoriously volatile currency, and it’s difficult to know what bitcoin will be worth even a week from now, let alone a year from now. To have a shot at predicting the price you need to know how the cryptocurrency is bought and sold, and what factors affect the price of bitcoin.
However, there might be two factors to consider above all others.
First, only 21 million bitcoin will ever be created. Throughout 2017, the number of bitcoin in circulation increased from about 16 million to 17 million, but it will slow down as it gets closer to the 21 million limit. The final bitcoin isn’t due to be mined until the year 2140.
This finite supply and its popularity increasing more quickly than its availability is thought to keep prices increasing.
Second, it’s important to remember that bitcoin is now just one cryptocurrency among hundreds. Although it’s the most valuable, bitcoin’s overall cryptocurrency “market share” is declining. Competing cryptocurrencies can offer some features that bitcoin can’t, and many people think another currency will eventually overtake bitcoin.
Many bitcoin proponents speculate that its limited supply will only increase the value of the cryptocurrency in the long run and is its greatest strength. But critics say that this will be its undoing.
They point out that inherent scarcity is a useful way of controlling value, but might be too impractical for bitcoin to ever become the standard global currency.
To judge for yourself whether it’s worth buying bitcoin, you may want to look at the history of its ups and downs to better understand the factors affecting its value.
|Bitcoin (BTC)||Indian rupees (INR)|
Bitcoin value can change a lot very quickly and has a history of sharp ups and downs.
Here are a few things that could affect the price of bitcoin:
Because bitcoin is a decentralised currency, the standards that dictate how to refer to it are still forming. XBT is the official designation, while BTC is the more commonly used code.
In its earliest days, bitcoin’s currency code was BTC. With its growing acceptance as a legitimate currency, the International Standards Organisation (ISO) designated bitcoin’s notation as “XBT”. If a currency is not associated with a specific country or government, its three-letter note starts with an “X.”
However, XBT has yet to gain much adoption beyond banker and finance types. BTC seems to be what the everyday person and most enthusiasts prefer. You’ll probably continue to see references to both BTC and XBT until one eventually sticks as the standard.
The very first bitcoin transaction took place on January 12, 2009, from creator Satoshi Nakamoto to developer Hal Finney. On October 5, online publication New Liberty Standard pegged the bitcoin exchange rate at 1 USD = 1,309.03 BTC — a calculation based on the cost of electricity for a computer to create bitcoin.
July 2010 saw the founding of Mt. Gox, a bitcoin exchange that would eventually grow into the largest player in the market. We’ll start our bitcoin price history in 2011, using figures from CoinDesk’s price index.
Note: Unless otherwise stated, all prices in this article refer to BTC:USD exchange rates.
Early in the year, one bitcoin finally became worth as much as one US dollar. In just a few months, the price of bitcoin shot past the $10 mark.
But on June 19 Mt. Gox was hacked, causing customers to lose more than 4,000 BTC. Bitcoin’s value hovered around $30 for several days and began a slow descent to around $4 by the end of the year.
Bitcoin experienced a recovery in 2012. The cryptocurrency didn’t hit the same heights it did the previous year, but it climbed back into the double digits by the end of the year.
June saw the founding of Coinbase, which is one of the largest bitcoin platforms today. In November, the publishing tool WordPress began accepting bitcoin as payment.
In February, bitcoin surpassed its previous all-time high and then abandoned the $30 range as it continued growing in value.
At the same time, Mt. Gox was failing as bitcoin transactions overwhelmed its servers. In the same month bitcoin broke the $200 mark. Less than a month after that, it shot past $1,000.
Chinese investment in bitcoin pushed the price of the cryptocurrency even higher. But December also saw the largest theft of bitcoin ever of 96,000 BTC from Sheep Marketplace. This was also the year that China banned its financial institutions from processing bitcoin transactions.
Bitcoin’s price euphoria came to an abrupt end, and the cryptocurrency steadily lost value over a year. Mt. Gox finally shuttered its doors. However, Microsoft and PayPal-owned Braintree started accepting bitcoin as payment.
In late January, Coinbase launched its bitcoin trading platform, while Mt. Gox’s CEO Mark Karpeles was arrested.
But the European Court of Justice ruled that bitcoin is currency, not property, and that the cryptocurrency would not be assessed a value-added tax in the European Union. Bitcoin’s price broke the $400 mark toward the end of the year.
The marketplace software OpenBazaar was released over the summer. It’s a peer-to-peer platform on which users can buy goods with bitcoin. Bitcoin’s price, in recovery mode at the beginning of the year, approached its former glory as it hovered around $1,000.
|Start||Peak to date||End|
Bitcoin reached a new peak early in the year at over $1,100 on January 4, then promptly plummeted below $800 a week later. It would repeat this pattern throughout the year, including hitting multiple all-time highs on 1 September 2017 before dropping by an immense 20% in the next three days.
This sudden drop may have been the result of traders taking advantage of the peak to sell off their bitcoin.
A month later it broke US$5,000 in another all time high.
As you can see, a lot can happen in a very short time.
finder.com.au is one of Australia's leading comparison websites. We compare from a wide set of banks, insurers and product issuers. We value our editorial independence and follow editorial guidelines.
finder has access to track details from the product issuers listed on our sites. Although we provide information on the products offered by a wide range of issuers, we don't cover every available product or service.
Please note that the information published on our site should not be construed as personal advice and does not consider your personal needs and circumstances. While our site will provide you with factual information and general advice to help you make better decisions, it isn't a substitute for professional advice. You should consider whether the products or services featured on our site are appropriate for your needs. If you're unsure about anything, seek professional advice before you apply for any product or commit to any plan.
Products marked as 'Promoted' or 'Advertisement' are prominently displayed either as a result of a commercial advertising arrangement or to highlight a particular product, provider or feature. Finder may receive remuneration from the Provider if you click on the related link, purchase or enquire about the product. Finder's decision to show a 'promoted' product is neither a recommendation that the product is appropriate for you nor an indication that the product is the best in its category. We encourage you to use the tools and information we provide to compare your options.
Where our site links to particular products or displays 'Go to site' buttons, we may receive a commission, referral fee or payment when you click on those buttons or apply for a product.
When products are grouped in a table or list, the order in which they are initially sorted may be influenced by a range of factors including price, fees and discounts; commercial partnerships; product features; and brand popularity. We provide tools so you can sort and filter these lists to highlight features that matter to you.
We try to take an open and transparent approach and provide a broad-based comparison service. However, you should be aware that while we are an independently owned service, our comparison service does not include all providers or all products available in the market.
Some product issuers may provide products or offer services through multiple brands, associated companies or different labelling arrangements. This can make it difficult for consumers to compare alternatives or identify the companies behind the products. However, we aim to provide information to enable consumers to understand these issues.
Providing or obtaining an estimated insurance quote through us does not guarantee you can get the insurance. Acceptance by insurance companies is based on things like occupation, health and lifestyle. By providing you with the ability to apply for a credit card or loan, we are not guaranteeing that your application will be approved. Your application for credit products is subject to the Provider's terms and conditions as well as their application and lending criteria.