[CS198.1x Week 2] Bitcoin Headlines


Following years of hacks and bad reputation,
Bitcoin finally began to grow in general popularity. Here are some of the big headlines following
Mt. Gox’s theft and subsequent declaration of bankruptcy in February 2014: In March 2014, people thought they had found
Bitcoin inventor Satoshi Nakamoto in California, but that was a false alarm. In September 2014, venture capitalist Tim
Draper announced his predictions of Bitcoin’s price heading up to $10,000. For context about his perspective, he was
interested in cryptocurrencies since before Bitcoin. In 2003, he met a father in South Korea who
bought a virtual sword for his son with fiat money, and was curious ever since. He also won some bitcoins from the FBI auction
of confiscated bitcoins from the Silk Road shutdown. 2014 was also the year when merchants began
to accept bitcoin as a form of payment. In January, Overstock.com became the first
major retailer to accept bitcoins. Then, in September, PayPal partnered with
Coinbase, BitPay, and GoCoin. Fun fact: Blockchain at Berkeley was previously
known as the Bitcoin Association of Berkeley, and in 2014, these headlines were happening
every week. At every club meeting, our 7 members would
discuss the latest hack, the latest bankruptcy, and the latest Ponzi scheme. We’ve grown so much since then, and that
just comes to show how much the blockchain space has matured over the years. A bunch of Bitcoin startups began popping
up too. Wallet companies helped other companies or
users handle bitcoin without having to personally join the Bitcoin network. For example, Coinbase is an online exchange
that manages wallets and lets users buy and sell bitcoin for fiat currency. Bitpay allows merchants to accept bitcoin. Blockchain.info is a block explorer that allows
users to see individual blocks and transactions in the Bitcoin blockchain in browser, without
having to download the entire blockchain themselves. Most importantly, during this time, the term
“blockchain” started becoming a buzz word. This is a graph of Bitcoin prices from 2014-2015,
where you can see that first prices shot up immensely, then slowly started to fall. Of course we all know that the price recovered
and went back up after this, but this was a huge shock to the community at the time. There are a few theories as to why Bitcoin
burst at this time: One was that investors who had speculated
and bought a lot of bitcoin had second thoughts, and began to sell. Especially, Chinese investors had sold because
of warnings issued by the Chinese government. And then of course the market amplified the
current trend, so people further dumped because they feared a loss in value.

About the author

Leave a Reply

Your email address will not be published. Required fields are marked *