Bitcoin Price Swings
Anticipating the Bitcoin halving, we looked back and recapped the events that caused BTC price movements. What to expect next?
Throwback Thursday by BTCMEX
Bitcoin halving is expected to take place on May 12, what does it mean for the BTC price? Which events were followed by the movements and how two previous halvings affected the price?
Bitcoin went online in January 2009, when its creator — Satoshi Nakamoto — mined the first, so-called Genesis, block with the reward of the first 50 BTC. The first public trade of Bitcoin took place on April 25, 2010. 1,000 Bitcoins would go for 0.3 cents each coin.
The increase in value hasn’t been seen for a year until July 2010, when the price of a coin went up to $0.08. Many link the price movement with the first real-world use of the cryptocurrency that happened two months earlier. In May 2010, a Bitcoin miner bought two pizzas for 10,000 Bitcoins, which at that time was approximately $25. The first well-known cryptocurrency exchange Mt.Gox was established the same year, and over time Bitcoin gained wider exposure among retailers.
Bitcoin rallied for the first time in summer 2011, after Forbes profiled the technology in the article “Crypto Currency”. The value of one coin increased up to $10. Soon after, Gawker revealed the Silk Road — the darknet marketplace accepting Bitcoin. On June 9, 2011, BTC peaked at $29.57, but the crash occurred soon. On June 19, Mt.Gox announced its database had been compromised and user information leaked. The price of the cryptocurrency started sliding down. Bitcoin was traded under $5 by the end of the year.
The Bitcoin obituary named “The rise and fall of Bitcoin” was published by Wired in November 2011, which has driven the attention of professional traders, who started investing in the digital asset. Bitcoin really started the take-off in 2013. The price rallied from $13 to $220 and dropped to $70 in mid-April.
Another spike took place in 2013, after the first halving, which occurred in November 2012. The block reward for mining was reduced to 25 BTC. The price went from around $200 to over $1,075. The rally was caused by new bitcoin exchanges and miners in China entering the marketplace. The differences in the prices among the different exchanges also lead to arbitrage opportunities.
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