How Much Was Bitcoin in 2009? Finding the Origins of Crypto
If you’re a crypto fan, you may wonder, “How much was Bitcoin in 2009?” the exact year that the popular cryptocurrency was founded. The BTC price 2009 answer may surprise you, given how well-known and widely distributed Bitcoin has become in recent years, and the fact that its value has fluctuated considerably, htiting an all-time high in November 2021. You might expect that, since Bitcoin quickly gained enough of a following to survive and eventually become an important element of the modern economy, that it must have started out at a relatively high value. However, that is not the case.
The simple answer is that for the majority of the year 2009, Bitcoin was worth less than one cent (USD), and it took years for it to break $1,000. Beyond a discussion of “How much was Bitcoin worth in 2009?” a better question is, “Why was the price so low?” or even , “How was Bitcoin able to gain traction if its value was initially so low?”
Though Bitcoin has reached values in the high tens of thousands of dollars, it did not originally sell at such a high value. To understand why, you need to know how Bitcoin’s value is determined, which goes back to the history of its creation.
Keep reading to learn more about the context around the question, “How much was Bitcoin in 2009?” and about how the world’s biggest cryptocurrency gained popularity and value.
When and Why Was Bitcoin Created?
To fully understand the answer to the question, “How much was Bitcoin in 2009?” you’ll need to also know the context in terms of when and why Bitcoin was created in the first place. The history of Bitcoin provides insight into the ideological underpinnings that shape how it gains value. Understanding the philosophical concepts that inspired Bitcoin's creation helps explain its emphasis on privacy, decentralization, and empowering individuals. As the value of Bitcoin continues to fluctuate over time, Bitcoin's historical beginnings fundamentally shaped the process by which it gains value. Appreciating this background is key to understanding its price from 2009 and onward. After publishing a 2008 white paper introducing the background concepts for a decentralized, blockchain-secured cryptocurrency, an unknown person or group operating under the pseudonym Satoshi Nakamoto created Bitcoin in 2009. Bitcoin was designed to be a decentralized digital currency that would allow for peer-to-peer financial transactions without the need for third party intermediaries. The creation of this cryptocurrency was in response to the 2008 global economic crisis, when the instability of traditional currencies and banking created a new need for alternative assets and investments that were not backed by a central government or banking organization.
Bitcoin was created as an alternative investment and banking solution in the wake of this financial crisis; the creator(s) of this digital currency sought to make an unregulated currency that would allow users to have direct access to their monetary assets and transactions without third-party interventions. This is meant to make the processes of buying, selling, and holding Bitcoin assets much more transparent and accessible than with traditional fiat currencies, which require banks and other third parties to participate in these processes.
Fiat currencies, such as the U.S. dollar, derive value from the decree of a government or central bank and the confidence of investors and lenders. Since the impetus to create Bitcoin came from a desire to break free of this traditional system, it makes sense that its value would be determined differently.
How Does Bitcoin Gain and Retain Value Differently Than Traditional Currency?
As you might expect, given its somewhat different aims, Bitcoin does not derive its value in the same way that traditional fiat currencies do. Much like gold (an asset that Bitcoin is frequently compared to), this cryptocurrency gains and retains value through the scarcity of its supply. Embedded within Bitcoin’s code is a 21 million unit limit, meaning that there will only ever be 21 million Bitcoins available to be mined unless the line of code which dictates this scarcity was ever changed. Bitcoin's code also includes built-in scarcity measures, referred to as Bitcoin halvings, that systematically reduce the amount of available Bitcoin for every 210,000 units mined.
Bitcoin’s dependence upon scarcity for its value makes it a potentially deflationary asset, which cryptocurrency devotees greatly appreciate; this currency was created as a “safe-haven” asset in the midst of a global economic crisis. However, it can also be an inflationary asset, because of new coins continuously increasing the supply. The relationship between supply and value also means the events such as periodic Bicoin halving (a deflationary event) have the potential to significantly impact the value of the cryptocurrency, as they reduce the amount of available Bitcoins in the supply.
How Much was Bitcoin Worth in 2009?
As mentioned above, during the early months of 2009, Bitcoin was valued at less than one cent per unit, and it wasn’t until July of 2010 that Bitcoin was able to reach $0.08 per unit. Why was the 2009 price of Bitcoin so low?
As you now understand, Bitcoin’s value comes from the scarcity of its supply — as more units are mined from the 21 million unit cap, the total available supply of Bitcoin is decreased, making each available unit more valuable as more are mined from this finite supply. Therefore, when Bitcoin was first launched in January 2009, no units had been mined yet. Its available supply was at its maximum (21 million units) and would not begin to gain a higher value until it gained more traction and use. So although the currency launched in January 2009, even the Bitcoin cost November 2009 saw was still zero dollars.
When Did Bitcoin’s Value Finally Increase Significantly Above The 2009 Price of Bitcoin?
Across the digital currency’s history since its creation in 2009, Bitcoin has experienced many fluctuations in price. However, this was not necessarily the case during the earliest years of Bitcoin’s existence.
It took until the year 2010 for Bitcoin’s price to reach 8 cents per unit. At the beginning of 2013, Bitcoin was worth only $13.50 per unit, a major increase from 2010 but still relatively low compared to its valuation in recent years. However, it was during 2013 that Bitcoin saw much more intense fluctuations in value: in November 2013 alone, Bitcoin’s price rose from $200 to $1,075 due to the expansion of mining operations in China.
What Is the Highest Value that Bitcoin Has Ever Reached?
Bitcoin’s price fluctuated greatly between 2014 and 2017 as it earned more global attention, reaching both historic highs and lows that the cryptocurrency had never experienced. By the end of 2016, the price had reached over $900. The year 2017 saw even more growth, and on December 15, 2017 Bitcoin had reached a price of $19,345.49.
In keeping with Bitcoin’s original purpose of responding to a global crisis, the COVID-19 pandemic caused a huge 2020 rise in Bitcoin value. Since Bitcoin is a decentralized currency, investors may have perceived it as a potential hedge against the actions of countries’ central banks when facing the economic impact of the pandemic.
Bitcoin's highest value as of this writing was on November 10th, 2021, when the cryptocurrency reached $68,000. Bitcoin saw numerous ups and downs throughout 2021, including a low of $30,000 in July. Bitcoin can rapidly increase and decrease in value at any moment. This naturally leads to wondering what the future holds for the price of Bitcoin.
Will Bitcoin’s Value Ever Fall to its 2009 Price?
If the answer to “How much was Bitcoin in 2009?” shocked you, you may also wonder if Bitcoin’s value could ever reach those lows again. Given that its value recently has been in the tens of thousands of dollars per unit, it would be devastating to Bitcoin holders and miners for its value to fall to less than 10 cents per unit. Cryptocurrency skeptics often refute claims of Bitcoin’s “safe haven” status due to its volatility, as demonstrated in the extreme price fluctuations experienced during the last months of 2017 and throughout 2021. If you follow cryptocurrency-related news, you may have been concerned during the recent “crypto winter,” when, after its highest market capitalization ever occurred in 2021, Bitcoin (and other cryptocurrencies) experienced a dramatic drop in value extending throughout 2022.
Despite its well-documented ups and downs, it’s unlikely that Bitcoin would ever fall to its 2009 values, and the reason comes down to crypto mining over time. This is because Bitcoin’s valuation during that year was caused by its newness: because hardly any units had been mined yet, there was little driving the digital currency’s price. With a growing interest in alternative currencies, as well as the maturation of this currency, Bitcoin’s value may increase in the future while maintaining relative stability compared to previous years, rather than returning to the 2009 price of Bitcoin. That said, let’s take a look at some of the factors that may influence the future of cryptocurrency.
The Future of Cryptocurrency
While Bitcoin has had many ups and downs over the past few years, it is difficult to project with certainty what will happen to its value in the coming years. However, in an increasingly digital world, in which the internet transcends boundaries that once divided people, a decentralized currency whose value is not tied to a particular government appears to fit with the march of technological and societal progress. That said, to give you an idea of some potential considerations, here are some factors that may influence the value of Bitcoin in the future.
INCREASED REGULATION
There has been increased interest by President Biden and other government officials to have more regulations for cryptocurrency. While the unregulated, decentralized market is what draws many individuals to invest in crypto, regulatory guidance could help protect investors from potential scams. In addition, these regulations could stop cryptocurrency crime and tax evasion, requiring crypto companies that facilitate trades to report tax information to the IRS starting in 2024. However, this will make tax compliance easier for investors; tax requirements regarding crypto are still developing and evolving so this is something for investors to constantly continue learning.
Another proposed regulation is stablecoin regulation. The legislation would classify stablecoin issuers as banks, requiring them to have the same oversight to protect consumers. Advanced traders usually use Stablecoins; however, the Biden administration report hints at them becoming a more mainstream digital payment system.
An additional potentially significant advancement is in crypto ETFs. These would make it harder to use crypto for illicit activities and tax evasion. While crypto ETFs have only recently become available in the U.S., they may offer a way for investors to obtain cryptocurrency without buying directly from an exchange in the future. As cryptocurrency continues to develop and find its role in the mainstream economy, new regulations may also continue to be proposed.
BITCOIN’S ACCEPTANCE AS A FORM OF PAYMENT
With further regulation of crypto, it could become a more normalized form of currency. Cryptocurrencies like Bitcoin can have significant benefits for businesses all over the world. Many cities, such as Memphis, TN, have seen a tremendous increase in businesses accepting cryptocurrency.
Due to their low transaction fees, offering Bitcoin as a payment option is an optimal business move for many establishments. With credit and debit, there is usually at least a three percent transaction fee and many hidden fees. Bitcoin can reduce additional fees to less than one percent. Additionally, Bitcoin transactions are much faster than those with credit and debit. While the traditional currency may take several days to complete a transaction, Bitcoin is nearly instant.
Another way Bitcoin can be helpful for businesses is due to its fraud protection. While traditional forms of payment usually require an individual to disclose personal information, often including their bank account number being associated with the transaction, Bitcoin does not need this. Because Bitcoin users use a unique Bitcoin address to access their wallet, often that is all required to make purchases with the cryptocurrency.
Being decentralized, Bitcoin is a global, almost universal form of currency, making foreign payments much more manageable. Using other currencies to make foreign purchases can exponentially increase transaction costs, while crypto will not. Accepting crypto is an intelligent business strategy, specifically for online stores, as this opens up the door to easier purchasing by customers in other countries.
CRYPTOCURRENCY IN THE NEWS
As a true innovation to something as essential as currency, which affects all of our daily lives, cryptocurrency attracts a lot of media attention. Similar to other investments, positive news about cryptocurrency may drive the price of Bitcoin up, whereas negative news may drive the price down. Nonetheless, it’s hard to know how different events that will come up in the news as Bitcoin continues to develop its impact on society will in turn impact Bitcoin’s value. If you’re trying to make decisions about investments, your best bet is to contact a certified financial advisor for advice. However, if you are looking for general information about the concept of cryptocurrency and how to buy it from an ATM, Pelicoin’s website is a great place to read more.
Looking for More Answers to Your Bitcoin Questions? Learn More with Pelicoin.
Over its history, Bitcoin’s price has seen many highs and lows, as well as a lot of interest in the news and beyond. The headlines can sometimes feel overwhelming, especially if you are a new cryptocurrency fan. When you want to make sense of the latest with Bitcoin, including the perspective of a company that works in crypto every day will help you better understand the subject.
Pelicoin is the leading cryptocurrency ATM service in the Gulf South, with locations in Louisiana, Texas, Tennessee, Alabama, and Mississippi. With our easy-to-use, secure crypto ATMs, you can gain in-person access to your Bitcoin, Litecoin, or Ethereum assets at one of our 30+ locations. Visit our blog to read up on the latest Bitcoin news and to learn more about the latest trends in the cryptocurrency scene, as well as to understand historical questions like, “How much was Bitcoin in 2009?” For more information about Pelicoin’s crypto ATMs, contact us today by emailing support@pelicoin.com or by calling 855-PELICOIN.