October 2008 A pseudonymous figure or group called Satoshi Nakamoto publishes a white paper entitled “Bitcoin: A Peer-to-Peer Electronic Cash System.” This introduces a new data structure, the blockchain, which over the next eight years will create billions of dollars of value and cause intelligent people to seriously speculate that it could be used to replace the entire global financial system. The mystery of Satoshi Nakamoto’s identity is never solved. Compared to much of what follows, this all seems pretty reasonable and plausible. May 2010 The first real-world Bitcoin purchase occurs: 10,000 btc, currently valued at ~$6.5 million, is used to purchase two large Papa John’s pepperoni pizzas in Jacksonville, Florida. Early Spring 2011 The rest of the world (including me) discovers Bitcoin. Reactions range from “this is a giant scam” to “the most dangerous project we’ve ever seen” to “this is our greatest hope for liberty” to “OMG, they’re all totally crazy.” Each of these contradictory viewpoints is surprisingly convincing. Spring 2011 Bitcoin is widely castigated for being primarily used to purchase drugs on darknet sites such as Silk Road. The traditional reaction to moral censure ensues: the price of Bitcoin immediately rises almost forty-fold in 10 weeks. June 2011 Bitcoin promptly falls back from $32 to $10. June 2011 Mt. Gox, a Bitcoin exchange originally set up to trade Magic: The Gathering cards, is hacked. June 2011 People keep using Mt. Gox, because, you know, what the heck, why not? What could possibly go wrong? Autumn 2011 The price of Bitcoin has fallen back down to $2. March 12, 2013 Most Bitcoin aficionados will tell you, in a tone usually reserved for tales of deaths, wars, famines and pestilences, that this is the day a “hard fork” occurred on the Bitcoin blockchain. In actual fact, there has never been a Bitcoin hard fork. April 2013 Bitcoin skyrockets back up to $100. July 2013 The infamous Winklevii twins launch the Winklevoss Bitcoin Trust exchange-traded fund. They found out about Bitcoin at a party on Ibiza. I am not making this up. November 2013 Bitcoin hits $250. November 2013 Bitcoin hits $500. November 2013 Bitcoin hits $1,000. December 2013 Bitcoin crashes back below $600. January 2014 The New York Times publishes “Why Bitcoin Matters” by Marc Andreessen, who argues (correctly) that “Bitcoin offers a sweeping vista of opportunity to reimagine how the financial system can and should work in the Internet era, and a catalyst to reshape that system in ways that are more powerful for individuals and businesses alike.”

Meanwhile, however, much of the early Bitcoin community is still using Mt. Gox, the Magic: the Gathering trading-card site turned Bitcoin exchange coded in PHP by developers of extremely dubious technical ability.

February 2014 Mt. Gox shuts down and files for bankruptcy, reporting the loss of 850,000 bitcoin, or about 7 percent of all extant at the time. Some…



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