September 7th promised to be a memorable day for Bitcoin. But even the latest correction will probably not mean the end of the cryptocurrency, even though the voices declaring Bitcoin dead (once again) are getting louder again.
The past few weeks have been really good for Bitcoin. The crowning glory could have been El Salvador’s BTC launch. But things were to turn out differently. Because yesterday, September 7, Bitcoin and the whole crypto market went brutally down within a few minutes. We could now hold long slogans and try to donate hopium. Talk about how one or two big whales were responsible for the crash and that BTC and co. will soon record green candles again.
But let’s let the bad news of the past – and the fact that it never came true until now – speak for itself. In the following article, a look back at the still young history of the No. 1 cryptocurrency – in the period from 2010 to 2021.
The Bitcoin chart in its entirety.
In nature, positive feedback loops like Bitcoin’s are deadly; the only thing that has kept Bitcoin alive for so long in the first place is its novelty. It will either remain a novelty forever, or it will go from novelty status to death faster than you can blink.
On December 1, 2010, you could buy a Bitcoin for less than $0.23, the same month the article was published. Bitcoin has now been such a “novelty” for over 10 years since that post. And you could be guaranteed to blink more than once during that time.
The article argues that Bitcoin is just like the gold standard, only a digital form. The author expands on his views following:
Bitcoin mining (they’ve even been the word borrowed!) is meaningless work that produces nothing of real value. Bitcoin is less convenient than paper money. Bitcoin denies the truth of capitalism being about value and not money by preventing the money supply from growing when the economy does. BTC enables random, unrecoverable effects like the 1930s depression. Bitcoin takes control of the economy away from the government, which means there is no control over the economy.
The Bitcoin community faced another crisis on Sunday afternoon when the price of the currency on its most popular exchange, Mt.Gox, fell from $17 to pennies in a matter of minutes. Trading was quickly halted and visitors to the homepage were directed to a statement that attributed the crash to a compromised user account.
Indeed, things looked grim for Satoshi’s coin at the time. The Mt.Gox hack exposed BTC to one of its biggest threats to date – and it survived.
Bitcoin in 2012
At the height of its popularity, BTC was touted as a viable alternative currency for the internet age, a monetary system designed to prevent theft, gambling and criminalization. Then came malware, the black market, the legal ambiguities … today you can’t even buy Facebook stock with it.
Even though Bitcoin lost a bit of value with yesterday’s slide, the fact that you can’t even buy Facebook stock with Bitcoin isn’t entirely true today. On December 21, 2012, a Facebook share was worth $26, Bitcoin about half that. Today, a Facebook share costs $382, while Bitcoin is trading at around $46,000. So today, one Bitcoin gets you a whopping 120 Facebook shares.
I learned about Bitcoin in 2011, just before it experienced its first massive surge, from less than a dollar to a high of $35 that summer. I didn’t think it was worth anyone’s time then be, and it’s not worth anyone’s time even now, unless you have a penchant for gambling and some money you don’t particularly care about. The very reasons Bitcoin is taking off today will be the main reasons its value is likely to collapse tomorrow.
Bitcoin will fail because it has no fundamentals beyond the news cycle. Why is the price of a single bitcoin so high right now?
Before I continue, I want to clarify that saying something is a bubble does not mean it will fall. It could rise to $500 or $1,000 or $10,000. That is the nature of manias.
The year 2014, after a brutal crash in the spring, was a bit quieter than, say, the current crypto year of 2021. Titled “Sorry, Libertarians: Your Dream of a Bitcoin Paradise Is Officially Dead and Over,” Salon published an article on BTC on March 7, 2014. At the time, the price was trading at $637. The article states:
Neither Satoshi Nakamoto nor Bitcoin ever had a chance to function outside the confines of conventional society. There will be regulation, there will be consumer protection, there will be rules and taxes and prosecution for those who break the law. Bitcoin is not a cyberpunk fantasy, nor is it a Thomas Pynchon novel. It is boring. The thrill is gone. And that’s why people are so angry.
Bitcoin in 2015
Then again, 2015 was a bit more volatile and ended green. On April 7, Coinfox announced an article titled “Bitreserve’s new COO: Bitcoin will disappear in 5 years.” At the time, the price was just trading back at $220. The article stated:
I’d be surprised if Bitcoin is still around in five years. BTC is a means to an end. The value of Bitcoin is not in the currency, it’s in the technology. I think once the world gets used to the Bitcoin platform, the noise will go away, and so will the currency. The real change is the idea of removing all barriers and making it ubiquitous. Whatever currency or commodity you want to transact with, you can do it, and you can do it for free. That’s pretty revolutionary.
Bitcoin in 2016
The year 2016 was similar to the previous year and ended green. Titled: “The Bitcoin bros lost out to the big banks, who are now playing themselves at the game of der digital currency try”Dealbreaker published an article on August 25. During that period, the BTC price was trading at $577. It states:
The crypto-anarchist revolution is over. My condolences. The advice of the victorious crypto-capitalists is: do what your parents did! Get a job at UBS, Deutsche Bank, Santander or BNY Mellon.
As a phenomenon, Bitcoin has all the characteristics of a Ponzi scheme, requiring a constant influx of converts to drive up the price based on the promise that it will be used by future converts. So the ultimate value of Bitcoin will be the same as all Ponzi schemes: Zero.
Further, on November 21, 2017, a user tweeted, “BTC in is dead. It has been split in two. There is Bitcoin Cash, and Bitcoin Core/Legacy. Get over it.” At the time, you could still buy a BTC for just under $8,000.
deadalǹ͔͜͡i͎̜͖͗̎͞x̛̳̠̤̥̦̉̊̕̕ (@deadalnix) November 21, 2017
The Bitcoin Year 2018
The New York Post published an article titled “Why Bitcoin May Soon Be Worth Nothing” on July 4, 2018. At the time, 2018 was a tough year for crypto investors. At the time of publication, the BTC price was trading at $6,610. In it, the author writes:
I thought we were finally going to get rid of bitcoin. But the fake “currency” I like to call Bitcon just won’t go away.
Bitcoin in 2019
Bitcoin has no unique value at all. Basically, it’s an illusion.
Excluding the Corona crash in March, 2020 was mostly positive for Bitcoin. On August 28,Fi published nextrapublished an article with the prophetic title “Cryptocurrencies are dead. Long live central bank digital currency!”. At the time, Bitcoin was trading at $11,356.
In the article, the author writes:
A much smarter person than I once said that cryptocurrency is “everything you don’t understand about money combined with everything you don’t understand about computers.”
On July 21, an article titled “Billionaire Investor Says Bitcoin Heading for $0, Which Is Very Far From the Moon” was published on Gizmodo . At the time, Bitcoin was struggling to get back to the $30,000 mark after a spike that extended into May.
I predict that all these forms of cryptocurrencies that are not backed by central banks or assets will eventually go to zero. I can’t tell you when that will happen, but it is inevitable that they will go to zero.
As of today:
Where do we go from here? On September 7, Bitcoin became legal tender for the first time, in one country. Actually, this is good news for BTC, as it testifies to the fact that the adaptation of the cryptocurrency has progressed over the years. The market crash, or rather the September 7 correction, should not be given too much weight these days. Rather, the September correction and the above news from the past decade can serve as a teaching object that we are in a highly volatile market. And that corrections are part of the crypto game.