The market price of Bitcoin surpassed $100,000 at 9:35pm EST on December 4th, 2024.
Sixteen years and two months earlier, on October 31, 2008, the Bitcoin white paper first appeared. Titled “Bitcoin: A Peer-to-Peer Electronic Cash System,” it slowly spread throughout Reddit threads and other internet discussion channels against a backdrop of failing financial institutions, massive bailouts, rising unemployment and falling economic output. For nearly eighteen months, developers worked on the schema outlined in the white paper as described by the evidently pseudonymous author Satoshi Nakamoto. “Pizza Day” marked a pivotal moment in Bitcoin’s history when, in May 2010, 10,000 BTC were exchanged for two pizzas, valuing Bitcoin at approximately $0.0025 per BTC. By July 2010, BitcoinMarket.com, the first cryptocurrency exchange, began reflecting Bitcoin’s first broadly recognized exchange rate, which hovered around $0.06 per BTC.
The six-cent valuation represented a significant appreciation from the earlier “Pizza Day” price and, more importantly, shaped by supply and demand dynamics within niche communities intrigued by Bitcoin’s novelty and algorithmically limited supply. Those transactions laid the groundwork for Bitcoin’s evolution from an experimental digital concept to a tradable asset, paving the way for more sophisticated exchanges and eventually, mainstream adoption.
Much more could be said about the intervening decade or so: Mt. Gox, the Cyprus Bank Levy, Ethereum, the Silk Road, Bitcoin’s price first being displayed on Bloomberg, futures contracts at the Chicago Mercantile Exchange, exchange traded funds (ETFs), Microstrategy, Tesla, FTX, the rise of thousands of cryptocurrency exchanges populated by thousands upon thousands of altcoins, non-fungible tokens (NFTs), and dozens of other milestones along the way. A more important account at this particular juncture, though, is the stark paucity of allies that Bitcoin has had among financial and business elites, most voicing harsh or dismissive assessments of its viability and prospects.
Warren Buffett, the CEO of Berkshire Hathaway and by some accounts the most successful investor of all time, famously dismissed Bitcoin as “rat poison squared” (Bitcoin price: $9,300), arguing that it lacks intrinsic value and serves only as a speculative asset rather than a productive investment. His recently-deceased business partner, Charlie Munger, echoed these sentiments, calling Bitcoin “disgusting and contrary to the interests of civilization” (Bitcoin price: $57,000) citing its association with criminal behavior and lack of inherent worth. Munger might have benefited from reflecting upon the comparative role of the fiat US dollar, not only in global crime but also in fueling wars, enabling destabilizing geopolitical intrigues, and other contentious activities.
Jamie Dimon, CEO of JPMorgan Chase, labeled Bitcoin a “fraud” in 2017 (Bitcoin price: $4,100) – even as technologists in his employ were working on closely-related projects – though he has since softened his stance on blockchain technology while remaining skeptical about Bitcoin’s potential as a currency. And Nobel Prize-winning economist Paul Krugman compared Bitcoin to a Ponzi scheme (Bitcoin price: $97,000), criticizing its inefficiency, high transaction costs, and impracticality as a medium of exchange. Krugman’s track record where the evaluation of technology is concerned is not one of particular merit.
Economist Nouriel Roubini, often referred to as “Dr. Doom” for his predictions of economic crises, has frequently called Bitcoin the “mother of all bubbles” (Bitcoin price: $6,000) emphasizing its volatility, scalability issues, and association with illicit activities. Senator Elizabeth Warren has focused her critiques on Bitcoin’s environmental impact (Bitcoin price: $47,000), citing its energy-intensive mining process, while also highlighting its regulatory challenges and risks to consumers. (The climate assertions are easily defenestrated and, Warren’s opposition to auditing the Federal Reserve are unsurprising.)
Bill Gates, co-founder of Microsoft, has raised concerns about Bitcoin’s speculative nature, saying he “would short it if he could” (Bitcoin price: $9,000). Those views, strangely enough, have not kept his $3 trillion firm from accepting payment in Bitcoin. Former IMF chief economist Raghuram Rajan has also warned about Bitcoin’s speculative tendencies (Bitcoin price: $60,000) and questioned its practicality as a store of value or payment method, cautioning against its potential to destabilize financial systems. India has attempted to ban cryptocurrencies, unsuccessfully. And circumstances may change, of course, but El Salvador seems to be doing fine.)
Critics tend to express common themes: Bitcoin’s speculative nature, inefficiencies, and societal risks, though their specific focus areas vary. Together, their critiques reflect a broad skepticism among many traditional financial and economic leaders regarding Bitcoin’s ability to fulfill its promise as a revolutionary currency or store of value. The key takeaway from these high-profile detractors is this: when a respected figure acknowledges the possibility of a controversial innovation within or adjacent to their field of expertise, they are often correct. And when those same individuals claim that a new innovation in their professional sphere is impossible, unworkable, or fundamentally flawed, they are almost always wrong. In this case, to be fair, we cannot declare these critics wrong in an absolute sense — only that they have been proven wrong over the course of sixteen years, as Bitcoin rose from an exchange rate of $0.06 to over $100,000.
Bitcoin has been declared dead (or its imminent demise predicted) approaching 500 times – the earliest at an exchange rate of $0.23 cents/Bitcoin. But although the significance of the decimal system is rooted in the evolutionary history of human anatomy – ten fingers, ten toes – Bitcoin’s attainment of the six-figure benchmark offers a fitting juncture to evaluate its progress, impact, and significance to date.
- The Power of Decentralization
Bitcoin’s success underscores the ability of decentralized systems to flourish without central planning. Unlike fiat currencies or centrally regulated financial instruments, Bitcoin operates entirely on free-market principles: it is governed by code, consensus, and voluntary participation. Its rise to $100,000 demonstrates how decentralized, permissionless innovation can challenge, improve upon, and surpass legacy systems – including those in the monetary realm.
- A Rejection of Fiat Monetary Interventionism
Bitcoin’s milestone highlights growing discontent with fiat currencies that are subject to inflationary pressures caused by central banks’ monetary policies. Its fixed supply cap (21 million coins) contrasts sharply with the unchecked expansion of money supply seen in traditional economies, making it a real-world example of Friedrich Hayek’s call for “denationalized money.” This milestone could be interpreted as a referendum against inflationary policies and a demand for sound money principles.
- A Demand for Sovereign Financial Control
Bitcoin appeals to individuals seeking financial autonomy. Its rise demonstrates the market’s preference for financial tools that empower users to bypass intermediaries, protect their wealth from government seizure or debasement, and facilitate transactions globally. This aligns with libertarian ideals of individual sovereignty and freedom, proving that people value — and are willing to pay a premium for — these features in a global economy increasingly dominated by surveillance and control.
- Proof of the Superiority of Free-Market Capital Allocation
Bitcoin’s value growth reflects the free market’s ability to allocate resources efficiently, even in speculative contexts. Capital has poured into Bitcoin and its ecosystem based on market participants’ beliefs in its utility, future prospects, and role as a hedge against traditional systems. This is evidence of the market’s capacity to identify and nurture transformative technologies without the need for government subsidies or mandates.
- Inclusion Through Disintermediation
Bitcoin has lowered the barriers to financial participation, especially for those excluded from traditional systems. Its permissionless nature enables global participation, giving people in underbanked regions access to tools for saving, transacting, and wealth creation. Bitcoin surpassing $100,000 symbolizes a triumph for economic inclusion, showcasing how free markets can deliver tools that empower the economically disenfranchised.
- Vindication of Trustless Systems
The trustless nature of Bitcoin — enabled by cryptographic proof and the blockchain — has gained global acceptance through the iterative processes of unfettered markets. Individuals worldwide have tested, challenged, and ultimately come to trust Bitcoin owing to its reliability, transparency, and predictability, not because of government enforcement. Its $100,000 valuation vindicates the idea that trust can be built through market mechanisms and technology, not coercion or centralized control.
Bitcoin is one of the most transformative breakthroughs in monetary economics in several hundred years. But the attainment of the $100,000 market price, noteworthy though it is, does not guarantee a clear path ahead for Bitcoin or the crypto sector overall. As an asset whose value is inherently derived from subjective assessments at a unique intersection of finance and technology, Bitcoin remains perpetually vulnerable to abrupt and significant revaluations, whether due to competing media or macroeconomic developments. True, it has withstood sixteen years of scrutiny and attacks from governments, entrenched intellectuals, fashionable skeptics, and competitors, rising by an extraordinary 3,999,900 percent from a initial valuation of $0.0025 on Pizza Day on May 22, 2010 to $100,005 on December 4, 2024, 5,310 days later. Yet, as with all paradigm-shifting advancements, the market nevertheless remains dynamic. Despite Bitcoin’s decade-and-a-half of antifragile reinforcement, complete impregnability does not exist.
If Bitcoin is someday supplanted by another digital asset offering indisputable improvements, its foundational role in seeding and anchoring the cryptocurrency asset class — and in driving trillions of dollars of investment into similar and related assets and enterprises — will remain as significant, if not more so, than its contributions to the present. For now, though, at the $100,000 milestone, Bitcoin’s supporters and proponents can regard their patience and insight as having been vindicated. Stability is an illusion, but volatility is truth.
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