The history behind cryptocurrency
The idea of cryptocurrency is born
Although cryptocurrency is a new thing for most people, the idea is actually quite a bit older than you might think. Already back in 1983, computer scientist David Chaum created an anonymous cryptographic and electronic money system called eCash. This system was tested through a company DigiCash in the 1990s, but was never a great success. In 1998, the Chinese programmer Wei Dai described a system he called "b-money" and a little later the American Nick Szabo launched the "bitgold" concept.
31. October 2008 - Bitcoins “whitepaper” is published.
As the very first cryptocurrency, Bitcoin was launched in a 9-page academic document. "Bitcoin: A Peer-to-Peer Electronic Cash System", was written by an unknown person named "Satoshi Nakamoto". Bitcoin is a digital currency based on a decentralized and untrustworthy system. The idea was first spread to an email list of particular interest in 2009 and spread to tech-interested early users who began discussing Bitcoin online.
2010 - Bought pizza with bitcoin
On May 22, 2010, a developer and early bitcoin user bought two pizzas online and paid with 10,000 bitcoin, which was equivalent to approx. 300 kroner at that time. Since then, the exchange rate has skyrocketed, and with today's exchange rate (January 2022), it is worth over NOK 3.6 billion! The day is remembered today as "Bitcoin pizza day" and is marked every year (humorously) by many in the crypto industry.
2011 - The emergence of altcoins (alternative currencies to bitcoin)
Based on blockchain technology and the infrastructure of bitcoin, in 2011 other cryptocurrencies were developed and introduced, such as Litecoin (LTC). Both Bitcoin and Litecoin are available for trading with us. If you are curious about how this works, you can read about how to buy cryptocurrency here.
2013 - Bitcoin passes $ 1000, Ripple (XRP) is launched and a hard drive with 7500 bitcoin ends up in the trash.
With increased media coverage and interest in bitcoin, the currency is experiencing tremendous growth from under $ 100 dollars in January to pass $ 1000 in 2013.
Ripple launches its cryptocurrency XRP, also based on bitcoin technology, with a focus on improving international transactions such as the transfer of values between different countries.
In the summer of 2013, a man cleans his desk and throws away a broken PC including the hard drive that contains 7500 bitcoin. So if anyone wants to go on a treasure hunt for a hard drive with bitcoin worth over 500 million Norwegian kroner, garbage dumps in Newport (Wales) are a good place to start. There have been several such cases and people have been searching (desperately) for old hard drives or passwords for such.
2014 - The cryptocurrency exchange Mt.Gox is hacked and shakes the market
After a bull market with a dramatic price increase through 2013 and into 2014, the bubble finally bursts when the stock exchange Mt.Gox gets into trouble.
The Japanese cryptocurrency exchange Mt.Gox, which accounted for over 70% of all bitcoin trading in the world, is hacked and goes bankrupt. This resulted in large losses, although a large part of the stolen values were recovered. With increased doubts about the security of cryptocurrency, the price of bitcoin falls and ends the year 2014 at around $ 300. Several other former crypto companies are also experiencing problems, and there is an increased focus on security and seriousness in the crypto industry. In retrospect, it has become more and more common for crypto exchanges to insure the values they hold, and for security routines to become much stricter. So do not worry, we take safety seriously to prevent such incidents from recurring.
2015 - Ethereum introduces smart contracts and Tether launches its stablecoin
In early 2014, at the annual Bitcoin conference in Miami, 19-year-old bitcoin enthusiast Vitalik Buterin introduces his plans for Ethereum. He has assembled a team of smart developers and Ethereum will be launched as a new platform in 2015. Ethereum is based on the technology on which bitcoin is built, but instead of being just an alternative currency, Ethereum will be a platform that allows for building decentralized applications and applications (dapps) at the top of the blockchain. So you can build whatever you want, and these programs will store their data and functions on the Ethereum blockchain. The currency ether (ETH) becomes the internal currency of this system, as it is used to both participate in and control the network. The concept of "smart contracts" is introduced. (Simply explained programs on the blockchain that enforce a contract). For example, one could now automate contracts that have to do with loans, trade, supply chain, insurance or anything else.
Tether (USDT) is launched as a stablecoin (stable currency) that is to be pegged to the value of the US dollar. This is how you can create crypto-versions of traditional currencies so that those who trade can exchange bitcoin for tether instead of having to sell it for US dollars. After Tether, several other stack coins have appeared, including DAI (link to dai) which you can buy at Firi.
2016 - Ethereum undergoes a "hardfork" after hacker attacks on the DAO smart contract
In 2016, Ethereum DAO was subjected to a hacker attack. The hackers found a loophole in the smart contract that caused 3.6 million ether to be stolen using a so-called recursive attack.
Ethereum DAO (Decentralized Autonomous Organization) had raised more than $ 150 million from more than 11,000 investors, making it one of the largest crowdfunding campaigns in history. In a short time, the hackers had stolen ethereum worth around 50 million USD (based on the value of the time).
The whole episode ended with Ethereum choosing to run a so-called hardfork that contains code changes that essentially create a new blockchain. The counterattack moved ether from the address of the hackers to a new address controlled by Ethereum DAO.
This became the subject of much discussion and disagreement (even today), because this was in direct conflict with one of the crypto-environment's important ideals which says "code is law". In other words, what happens on the blockchain is finite and should not be able to be changed or rolled back. Part of the strength and essence of blockchain technology lies in the fact that no one from outside should be able to change the blockchain.
The majority in Ethereum decided that an exception had to be made, and Ethereum was thus divided into two, where they got a new "fork" which reversed the hacker attack. But there were also those who disagreed, and Ethereum lives on to this day, both as Ethereum Classic (the blockchain that contains the money that was stolen) and Ethereum.
2017 - “Bullrun”, new all time high and “altcoin mania”.
In 2017, bitcoin experienced incredible growth, from just over $ 900 in January to just under $ 20,000 in December, then cooled down and ended the year with a price tag of around $ 16,000. Crypto "bullrunet" continued further into January 2018 with Ethereum and other altcoins that went completely to heaven. Ethereum went from around $ 7 in January 2017 to a peak of over $ 1400 in January 2018 and made the early Ethereum investors insanely rich in a very short time. In the wake of Ethereum's launch where they made a so-called ICO (Initial coin offering) where they sold ether to early investors, a whole bunch of new cryptocurrencies gradually appeared that also collected money through an ICO, and it all developed into a full "ICO Mania ”with various altcoins, a big bubble that the world had never seen before. This bubble finally burst in January 2018 where many of these projects crashed and lost up to 90% of their value in a short time. Many coins never came back from this crash, and some of the projects were shut down.
2018 - The great cooling and Lightning network
In 2017, most people could make good money on the rise of the many different cryptocurrencies, regardless of whether one invested in good or bad projects. But whether they really got to keep the money depended on whether they managed to sell out in time. Many also lost a lot of money because they bought at the top and were with the crash all the way down again.
The market experienced a severe cooling in 2018, and there were large price falls on all cryptocurrencies. The price of bitcoin at the end of 2018 was around $ 4000.
The good news this year, however, was the introduction of the "Lightning Network", which will make bitcoin transactions both faster and cheaper.
Another good news was that in the middle of this extreme downturn we chose to continue with Firi (formerly MiraiEx), which we started at the end of 2017. So that today there is a Nordic cryptocurrency exchange where Norwegians can buy and sell bitcoin (BTC) , Ethereum (ETH) and other cryptocurrencies for Norwegian kroner.
2019 - Firi launches the first registered Norwegian crypto exchange
2019 was a very rich content for us in Firi. Following the registration with Finanstilsynet in January, we launched the cryptocurrency exchange and fully invested in Norway.
Firi (formerly MiraiEx) was well received by the market, and experienced good growth in user base and number of transactions. It was not only our users who welcomed us. Both The Factory and Angel Challenge took us into their programs to help us grow and raise external capital, which we did.
2019 - New price increase and "mini bullrun" for Bitcoin.
After a decline in prices and less interest in 2018, the year 2019 started with low prices and a "bear market" that reached the bottom. From February 2019, price developments began to point upwards again, and new optimism for cryptocurrency began to build up. Moreover, even though prices had been low, people had not stopped building and innovating. Many smart people had been working hard all over the last year, and many of the crypto innovations such as Defi, NFTs, Gaming, Metaverse and so on were further developed.
In May 2019, Facebook also announced that they were planning their own cryptocurrency "Libra", which was later met with skepticism by US senators and also by many in the market. The plan was later postponed and downgraded, but still lives under the name "Diem".
In 2019, moreover, a strange story reaches the media when a Canadian crypto exchange named Quadriga announces that their CEO Gerald Cotten has been found dead on holiday in India. Cotten put on access to a large sum of money and only he had the password to the crypto wallet. There is speculation that he may have forged his own death, and today it remains a mystery what really happened in India. This story again highlighted the importance of a focus on professionalism and security routines for the crypto exchanges, and that it is the players who take this seriously who will survive and succeed in crypto. We at Firi take safety seriously! Here you can read more about how Firi is registered with the Financial Supervisory Authority and secures your cryptocurrency
2020 - Bitcoin is still alive, and the corona crisis kicks off the biggest "bullmarket" of
After being declared dead over 350 times in the last decade, bitcoin turns out to be the best investment in 2010 - 2020. In 2020, optimism rose again as a new Bitcoin halving approached in May 2020. The halving has historically been the starting point for Bitcoin's "bull markets" because the halving cuts the number of new bitcoins mined by half. When only half as many new bitcoins come on the market, while demand is the same (or in this case rising) then it will create a positive pressure on the price.
Bad news came from China in early 2020. The corona virus had spread to a worldwide pandemic, and unrest began to spread in the financial markets. It culminated in a major price slump in all the major markets. Both stocks and cryptocurrencies experienced a huge crash, and the price of Bitcoin dropped all the way down to around $ 3000 in early March. Bitcoin was again declared dead.
But what happens when the whole world has to shut down, people have to stay at home and the authorities in the world's leading nations do not really have enough money on the books? Yes, they are starting to print money.
And Jerome Powell in the US Federal Reserve, in addition to his colleagues in other countries, they started printing money to keep the economy going and stimulate the financial markets. In fact, they historically printed a lot of money and have not stopped doing this to date. Never before in modern times has so much money been printed as in 2020 and 2021, which has contributed to the world's financial markets going from a major crash to the largest ever price increase. The US S & P500 index, for example, continued to set all-time highs throughout the second half of 2020, throughout 2021 and into 2022.
Many of these currencies also found their way into crypto and Bitcoin. As mentioned, Bitcoin had halved in May 2020 and both the development and adoption of crypto has had enormous growth. Adoption began to be seen from large and respected players in finance, and one well-known investor after another began to publicize his enthusiasm for crypto. When the stimulus measures from the world central banks started, it gave the growth in Bitcoin and crypto an extra strength, and this has taken us into the historical growth we have today. In the autumn of 2020, Michael Saylor, the head of the listed American company Microstrategy, announced that they had bought Bitcoin for over $ 250,000,000 and after this several other well-known companies came out with similar news, including Elon Musk and Tesla.
Since halving in 2020, more niches in crypto have also emerged and created new opportunities for investors. The summer of 2020 is remembered as the "Defi Summer" because the emergence of decentralized finance (DeFi) led to wild price increases in many new DeFi cryptocurrencies. Projects such as Compund Aave, Maker, Yfi, Chainlink, Uniswap and Sushiswap had an extreme price development and climbed into the list of the largest cryptocurrencies.
2021 - New heights, mainstream adoption, Memecoins, NFTs and Metaverse.
2021 started the year with a continuation of the upswing in 2020. During 2021, Bitcoin set an all time high of around $ 69,000 in November before the price fell again towards the end of the year.
But 2021 was also the year crypto really went "mainstream" and the increase in new users exploded from January onwards. In addition to the fact that Bitcoin and Etherum have had good price developments, it has been seen in particular that altcoins have again received a lot of attention.
Elon Musk may have made his mark on the year in particular. In addition to revealing his interest in Bitcoin and crypto, Musk began talking hotly about the memecoin Dogecoin (DOGE) in several of his twitter messages. Dogecoin was started as a parody, and uses a well-known internet meme with a Shiba Inu as its trademark. But DOGE works technically and can actually be used as currency. Elon Musk amused himself with Dogecoin in his Tweets, and it resulted in DOGE becoming one of the most traded cryptocurrencies almost overnight and the price exploding. In the wake of DOGE, a wave of "dogecoin copies", such as Shiba Inu (SHIB) and the like, quickly emerged, and it all developed into a "memecoin mania". Many of these were unfortunately junk projects without any fundamental use, and many felt this was an unfortunate trend for crypto.
We also experienced a large price correction from the top in April / May where the market overheated and attention was again seen around the energy use of Bitcoin and other cryptocurrencies. China and other governments "cracked down on crypto", but only with a temporary effect. Nevertheless, crypto-adoption sim continued strong growth. There is so much to write about and it will be difficult to include everything that happened in 2021 because this year was really historic for crypto, and maybe also in a world context.
Here are just a few of the things that happened in 2021:
- Many of the world's largest financial institutions went heavily into crypto
- A number of crypto companies went public.
- El Salvador adopted Bitcoin as a national currency, mined bitcoins with volcanic energy and announced plans for a "Bitcoin City"
- China banned crypto mining, and mining moved in record time to the United States, Kazakhstan and a number of other countries
- Memecoin mania exploded. Some millionaires overnight, while others lose everything.
- The increase in crypto scammers is worth mentioning. So-called "rug-pulls" happen daily, and new investors must learn to take care of themselves.
- NFTs are emerging as a new trend in cryptocurrency, and are developing into a leading field in blockchain.
- Ethereum gets scaling problems as a result of its own success. The "NFT boom" is an important reason for this.
- The website opensea sets new records both in price of "digital art" and in trading volume on the Ethereum network.
- Other L1 cryptocurrencies ("Ethereum competitors") achieve great success because users move from ethereum to other networks that are not overloaded. Binance Smart Chain, Solana, Terra, Avalanche and more are growing rapidly
- Crypto-gaming is taking off and the "meta-verse" is a trend carried forward by the crypto industry
- Digital properties in the "meta-verse" are sold for millions online.
- Facebook announced that they will change their name to meta and focus on the "metaverse" trend
- "Web3" is emerging as a new concept. The new internet will be built on the blockchain
- Several leading crypto investors are joining the list of the world's richest.
- Firi will be one of Norway and the Nordic region's fastest growing companies
2022 & Beyond
We are very proud to be part of the crypto industry and are very excited to follow developments further. The last few years have been fantastic and we think this is just the beginning. Where do you think the road will take us further in 2022 & beyond? Feel free to follow us on social media and share your thoughts!