The history of Bitcoin began in 2008 and during this time it has undergone a huge number of ups and downs. Thus, for a long time, the rate of the cryptocurrency did not actually change, and its value was very small. However, there were also sharp jumps in Bitcoin prices. We could see one of these surges in 2017. But despite such instability of the exchange rate, more than 300 thousand transactions in “digital gold” are made every day and their number is increasing every day. Below you can see a graph showing the dynamics of the Bitcoin exchange rate throughout history.
Bitcoin exchange rate dynamics in 2008-2010.
2008 is the year when the Bitcoin cryptocurrency appeared. Three cryptography experts filed a patent for blockchain technology and the Bitcoin.org domain in August of this year. At the same time, these persons completely deny their involvement in Satoshi Nakamoto, who published a report in October 2008 on a new system for carrying out transactions and settlements in electronic currency using P2P technology. In this regard, to this day Satoshi Nakamoto is considered the founder of Bitcoin. According to the idea of the author of the blockchain concept, its creation will solve many problems on a global scale related to financial fraud and the new “digital currency” will receive official legal status in many countries, which we, in turn, are seeing today.
In October 2008, the first transaction was carried out between Hal Finley and Satoshi Nakamoto.
The following year was marked by the fact that the new cryptocurrency for the first time received a rate relative to other currencies. So, for 1,309 BTC they gave $1. However, the exact value of the cryptocurrency has not been determined.
In May 2010, an event occurred that had a huge impact on the further development of cryptocurrency. So, for 10,000 bitcoins, which was approximately $25, the most ordinary pizza was purchased. Given today's exchange rate, the cost of a pizza would be several million dollars. Just a few months after this, the price of the cryptocurrency showed rapid growth and amounted to $0.080 per bitcoin. In November, the rate was already set at $0.50 for one “digital coin.”
Why is complexity needed?
The software should automatically make it more or less difficult for miners to find the hash - this is necessary to ensure the stability of the generation of new blocks. Thanks to the adjustments, the system remains stable: no matter how many devices there are in the blockchain network, calculations will still take about 10 minutes.
The difficulty of mining cryptocurrency is a very important indicator that any beginner should take into account. The more miners and new blocks there are in the network, the less profitable the coin becomes. Therefore, miners who were the first to enter the industry were able to make significant profits in a short time. But those who come later must be sure that the mining will bring them additional income.
Bitcoin exchange rate dynamics in 2011-2015.
In 2011, the price of Bitcoin rose from $1 to $91. However, despite gradual growth over the past few years, a period of sharp decline has begun. This moment in the history of cryptocurrency is also called the “Big Bubble”. It should be noted that this was caused by a number of objective reasons. Firstly, the largest theft in the history of “digital gold” occurred. About 25 thousand coins were stolen by scammers. Secondly, the number of thefts began to grow at a rapid pace, which led to a decrease in user confidence in cryptocurrency.
At the same time, despite all the problems, Bitcoin Central Bank was founded in 2012, received the appropriate license and was recognized by leading European financial regulators.
Until February 2013, the Bitcoin rate was practically in a “frozen” state. However, since that time there has been a tendency towards its growth. First, the cost of one coin increased to $30, and then within a few weeks it soared to $266.
Another serious drop (by half) was caused by the arrest of the Silk Road trading platform in October 2013. At the same time, by the end of the year the average cost was already about $1000.
Bitcoin exchange rate in 2014-2017.
From the beginning of 2014 to the end of 2015, there was again a downward trend in the Bitcoin exchange rate. The abrupt change in cost was caused by its formation and gradual development, as well as the development of high-quality software for its more efficient functioning and security. At this time, the cryptocurrency rate was balancing at an average of $370 per bitcoin.
Like any traditional currency, Bitcoin is also subject to changes in the external and internal environment. In particular, the departure of one of the main developers of the platform, Mike Hern, from the community at the beginning of 2016 led to a drop in price by $50. At the same time, the specialist criticized his former colleagues for refusing to further increase the volume of currency production and focusing on the Chinese market, where about 80% of all transactions using coins are carried out today.
At the same time, despite Mike Hearn’s forecast that the value of the cryptocurrency will show a decline for a long time, a sharp rise began in May. As a result, the rate reached $600, and Bitcoin’s capitalization exceeded $30 billion. This level remained until September, and in December another record was broken, reaching $1,000.
In 2022, the sharp growth of Bitcoin continues to increase and in June already amounted to $2,900, which, according to experts, is far from the limit.
The insignificant drop is most likely due to an adjustment in the cryptocurrency exchange rate, as well as the summer period, which is the least active yearly for the trading market.
What factors influence complexity
The Bitcoin mining difficulty indicator is influenced by three main factors:
- The number of people and, accordingly, devices involved in the network
- Having a global block difficulty, which depends on finding a valid hash below a certain level.
- Mining speed set directly by the mining pool.
The last parameter differs for each individual pool and each cryptocurrency.
Exchange rate growth since summer 2017
From July 2022, Bitcoin begins its rapid growth. At the same time, if we look at the cryptocurrency growth chart in more detail, we can pay attention to the following pattern: first there is an increase to a certain value, after which it consolidates at the achieved level, and then, as a rule, a rapid decline in the rate follows. Why is this happening? All this so that the most experienced market participants can purchase a new “portion” of bitcoins at the lowest cost, and then sell it profitably when the bitcoin rate again exceeds its previous maximum. Everything is logical in the world of trading, right?
How is difficulty calculated?
The difficulty of mining blocks starts at 1 and cannot fall below this value. The network then compares the formation timestamps of each block to see how long it took to form them.
If we want to know how long it took to create 2016 blocks, we will assign this parameter to the variable T. We want 2016 blocks to be created in two weeks, so if T is equal to another value, we multiply the difficulty by (2 weeks / T). For example, if mining the required number of blocks took only 10 days, then the difficulty is too low, it needs to be increased by 40%.
Bitcoin mining difficulty increases or decreases based on whether it took less or more than fourteen days to generate 2016 blocks. As a rule, if the network hashrate drops, the indicator also decreases.
You can roughly predict the next change based on the timing of the last blocks. However, no one can make long-term forecasts, although there are attempts to do this with the help of hardware advances - Moore's law, analysis of exchange rate direction, etc.
Maximum Bitcoin rate - December 2022
In December 2022, Bitcoin reached its all-time high of about $20,000 per bitcoin. Such a rapid increase in the value of a digital coin led to a great stir in society. Miners began quickly buying equipment off store shelves to create mining farms, while other enthusiasts continued to exchange accumulated fiat money for digital gold in the hope of earning hundreds of thousands of dollars in the near future.
The graph shows that on December 11, 2022, the Bitcoin exchange rate against the US dollar (according to trading data from the Bitfinex exchange) reached its maximum level of $19,891, after which serious unrest began in the cryptocurrency market, which resulted in a rather rapid decline.
Bitcoin price drop in January-February 2022
On Christmas Eve, Bitcoin was trading at $17,000, its highest rate in January 2022, after which the value of the coin fell by as much as $7,000 in just 10 days.
Such a rapid collapse in the cue ball rate is due to a number of factors , including:
- the governments of China and South Korea have publicly announced their intentions to tighten regulation of the cryptocurrency market;
- in the period from February 15 to 21, the People's Republic of China traditionally prepares for the celebration of the Chinese New Year, which inevitably entails the exchange of holders of a certain part of their crypto savings for fiat funds.
Note that the collapse of the crypto market, which we observed at the beginning of 2018, is a completely predictable event . Over the past four years, we have annually observed a similar situation in the digital coin market. In each case, it took a certain period of time to rehabilitate the Bitcoin exchange rate after a protracted fall. For a more clear understanding of the market, we suggest that you familiarize yourself with the following graphs of the growth and fall of the Bitcoin exchange rate for 2014-2017:
Bitcoin rate in 2014
Bitcoin rate in 2015
Bitcoin rate in 2016
Bitcoin rate in 2017
If you carefully read the presented graphs, you probably noticed a tendency for the Bitcoin rate to increase in the second half of each year.
As of April 15, 2018, the exchange rate of 1 bitcoin against the US dollar was $8,340. And based on the trends of past years, we predicted a rapid jump in the value of the most popular coin.
Current difficulty and schedules
Difficulty levels are constantly changing. Here are several relevant ways to find out at what level the parameter is currently located:
- https://www.blockchain.com/ru/charts/difficulty. Graph of Bitcoin mining difficulty over the entire existence of the blockchain network (you can select a period).
- https://www.coinwarz.com/difficulty-charts/bitcoin-difficulty-chart. Graph and table with average values by day. Statistics of changes in the value of Bitcoin Difficulty per day are presented; 30, 60 and 90 days.
- https://bitcoin.sipa.be/ — Several graphs displaying the current and predicted difficulty of the BTC network.
- https://bitcoinwisdom.com/bitcoin/difficulty - information about the hashrate and difficulty of Bitcoin, comparative charts.
- https://diff.cryptothis.com/ is another detailed and visual site that updates information in real time.
- In the Bitcoin console of the Bitcoin Core wallet, enter the getdifficulty or getmininginfo commands:
A caveat: to find out the current value in this way, the blockchain network must be fully loaded (100% synchronized).
Course in 2018-2020
Since the beginning of 2022, Bitcoin has continued to decline in price, which was due to a number of reasons. Thus, the mailing service MailChimp in the spring completely banned mass mailing of letters to ICO organizers and crypto traders.
On June 26, Facebook lifted the restriction on the publication of cryptocurrency advertising introduced in January 2022, deciding that such ads can be published subject to prior moderation.
By November 15, 2022, the Bitcoin rate fell to $6,000, and on November 25, even lower - to $3,600 per token.
At the beginning of 2022, the chart was in a flat state. Token holders did nothing, waiting for further developments. The most favorable period in 2022 was April - August, when the cost per token rose to $13,000. By the end of December, the coin was trading at a rate below $10,000 due to an unfavorable news background: the Chinese authorities began to speak negatively about “digital gold”, and the Bitcoin Black Friday online sales service stopped operating.
By March 2022, the Bitcoin rate dropped to $5,000, and then began to gradually increase and traded at a price of up to $10,000 for six months. Starting in late October, the token began to grow rapidly and reached $30,000 on the last day of the year.
Miami Mayor Francis Suarez tweeted that he would "definitely consider" putting 1% of the city's treasury into Bitcoin, calling the crypto coin a stable investment.
