In the 14 years and three halves since, bitcoin has become one of the most important financial instruments, clearly demonstrating that a currency not controlled by a central bank is capable of challenging the established monetary order.
With that in mind, what important events have taken place over the past 14 years, and how has the price of bitcoin weathered the ups and downs? What can we expect from bitcoin in the future? Read on to find out the answer to these questions and more.
On its 14th anniversary, Bitcoin’s message is stronger than ever.
The first bitcoin transaction was sent by Satoshi Nakamoto to American cryptographer Hal Finney, along with a message criticizing the actions of governments and banks in the wake of the 2008 financial crisis.
In the face of growing macroeconomic turmoil and the inability of central banks to deal with inflation problems – largely due to the unprecedented growth in the money supply during the coronavirus pandemic – the artificially capped coin supply and decentralized network of bitcoin can be seen as the primary alternative to traditional, inherently inflationary fiat currencies.
Bitcoin’s 10 Most Important Milestones
Bitcoin has achieved many important milestones and faced several significant hurdles in its nearly decade and a half history. Here are 10 events that we believe have had the biggest impact on bitcoin so far:
- November 28, 2012: bitcoin’s first halving
- February 28, 2014: Mt. Gox, the largest bitcoin exchange at the time, files for bankruptcy.
- July 9, 2016: Bitcoin halves for the second time.
- August 1, 2017: Bitcoin Cash’s Hard Fork
- May 11, 2020: Bitcoin’s third halving
- February 8, 2021: Tesla invests in Bitcoin
- February 20, 2021: Bitcoin reaches a market capitalization of $1 trillion for the first time.
- September 7, 2021: El Salvador makes bitcoin legal tender.
- November 14, 2021: Taproot update is activated.
- November 11, 2022: Leading crypto-currency exchange FTX files for bankruptcy.
Between its third halving on one hand and FTX’s bankruptcy filing on the other, bitcoin has seen remarkable market activity over the past two years.
What can we expect from bitcoin in the future? As we approach bitcoin’s fourth two-for-one split and given the favorable historical price data, our bitcoin price prediction algorithm predicts that the price of bitcoin will increase by more than 150% and exceed $40,000 next year. We will explore this in more detail in the next section.
Bitcoin has never closed in the red zone two years in a row: Will the trend continue?
The price of bitcoin has fallen more than -60% in the past 12 months. However, there is a strong bullish precedent in play that could herald a major reversal in the coming months.
For starters, bitcoin has never closed in the negative two years in a row. It is true that we have a relatively short set of historical price data to work with. However, roughly speaking, bitcoin has run on 3 years of growth followed by a year of market retracement. periods, at least until now.
| Bitcoin price | Change in % year on year | |
|---|---|---|
| Jan 3, 2011 – Year 2 | $0.295 | No data available |
| Jan 3, 2012 – Year 3 | $4.88 | +1,544% |
| Jan 3, 2013 – Year 4 | $13.40 | +175% |
| Jan 3, 2014 – Year 5 | $818 | +6,004% |
| Jan 3, 2015 – Year 6 | $284 | -65% |
| Jan 3, 2016 – Year 7 | $429 | +51% |
| Jan 3, 2017 – Year 8 | $1,044 | +143% |
| Jan 3, 2018 – Year 9 | $15,079 | +1,344% |
| Jan 3, 2019 – Year 10 | $3,844 | -74% |
| Jan 3, 2020 – Year 11 | $7,317 | +90% |
| Jan 3, 2021 – Year 12 | $32,878 | +349% |
| January 3, 2022 – Year 13 | $46,424 | +41% |
| Jan 3, 2023 – Year 14 | $16,729 | -64% |
Bitcoin has never closed in the red zone for 2 consecutive years.
The main reason for this cycle of “3 to 1“lies in the fact that the halving of bitcoin is scheduled every 4 years. When a halving is triggered, bitcoin miners receive only half the reward they received before the halving. The next and fourth halving of bitcoin – scheduled between February 2024 and June 2024 – will see the miner reward rate drop from 6.25 BTC to 3.125 BTC.
In general, bitcoin investors are excited about the idea of a halving, as they see it as a positive influence on the price of bitcoin. Indeed, previous halving has always been accompanied by a growth in the storage price, as shown in the bitcoin halving chart below.
Bitcoin halves have been one of the most important drivers of the BTC price.
There’s no doubt that bitcoin, along with most crypto and traditional assets, performed quite poorly last year. With further interest rate hikes expected in 2023, the financial markets and crypto assets could continue to plummet, at least in the coming months.
However, there is a clear chance of recovery in the cards, highlighted by the cyclical nature of the bitcoin price and its correlation with periodic bitcoin splits. This has made bitcoin one of the most popular long-term crypto investments.
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