Bitcoin, created by Satoshi Nakamoto in 2009, didn’t have a price when it first started since no one wanted to buy it. On October 12, 2009, Martti Malmi, a Finnish developer who assisted Satoshi with Bitcoin development, sold 5050 Bitcoins for $5.02, marking the first time Bitcoin gained value. This equated to $0.0009 per Bitcoin. Until 2021, a Bitcoin was worth up to $68,000. What happened to it?
Bitcoin began in 2022 with nearly double the value of January 2021 and reached an all-time high of $68,000 in November 2021. But before the first month of 2022 ended, Bitcoin almost lost all the profits of the previous year, decreasing by about $33,000 in January.
At the moment BTC has re-touched the $20k mark, the lowest price since November 2020. The market has entered a downtrend.
So what caused the market to drop so sharply?
Here is a timeline of Bitcoin’s rise, fall, and journey towards the $68,000 mark and finally its fall in a short span of time
Cryptocurrency picked up a bid at lows after the U.S. launched an airstrike at Baghdad’s international airport, killing top Iranian General Qassem Soleimani.
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The CME Globex has begun offering options on CME’s bitcoin futures contracts. Each contract, which is priced in US dollars and represents five bitcoin, is cleared centrally to eliminate counterparty risk.
Bitcoin derivatives have been offered on numerous cryptocurrency exchanges since at least 2014, but when CME debuted its cash-settled bitcoin futures in December 2017, it was one of the first to offer investors regulated products.
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The Swiss town of Zermatt, home to the renowned Matterhorn, is now the second in the country to enable taxpayers to pay their taxes in Bitcoin (BTC). Taxpayers in Zermatt will be able to pay their bills in Bitcoin via a point-of-sale system or an online payment interface installed in the town hall.
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A central bank decree prohibiting banks from providing services to crypto firms was rejected by India’s supreme court in April 2018. The Reserve Bank of India (RBI) had presumed that virtual currencies represented a systemic danger to the banking system when it issued its diktat.
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In mid-February, Bitcoin was trading near $10,000 and began to fall as the coronavirus pandemic increased.
Even safe-haven assets like Gold, Silver, and Bitcoin couldn’t withstand the worldwide coronavirus stock market meltdown on March 13, sending investors to cash. To meet redemptions and margin calls, people are raising cash. People are having difficulty trading due to a lack of market liquidity. The buy-on-the-dip mentality has been completely reversed.
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The price spike happened immediately after the Federal Reserve of the United States announced that it would lower interest rates to 0% and initiate a $700 billion quantitative easing program, as well as additional information on the types of securities it would buy. The large stimulus program is intended to counteract the market disruption caused by the Coronavirus.
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Bitcoin’s third halving, the network’s quadrennial landmark and the most anticipated event this year in the cryptocurrency industry, has finally happened. The reward per block mined on bitcoin’s blockchain was reduced to 6.25 BTC from 12.5 BTC at 19:23 UTC. However, the Bitcoin price did not have too much volatility after the event.
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Regulators in China’s Sichuan province have sent a notice to all cryptocurrency enterprises operating within their jurisdiction, requesting that all mining and mining-related operations be stopped immediately. Because of the massive quantity of Bitcoin hash power (computing power) generated in the regions, the mandate is very important. This is negative news for the stock market. The price of Bitcoin, on the other hand, contradicts this. In just one week, the price increased by 16%.
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The Office of the Comptroller of the Currency (OCC) has clarified that national banks and federal savings associations can provide cryptocurrency custody services for customers. The OCC sees banks providing crypto custody services as “a modern form of traditional bank activities related to custody services.”
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PayPal has entered the cryptocurrency market, stating that its users will be able to use their PayPal accounts to buy and trade Bitcoin and other virtual currencies.
PayPal will be allowed to use the license to create a new service that will allow consumers to buy, hold, and trade cryptocurrency (initially Bitcoin, Ethereum, Bitcoin Cash, and Litecoin) directly from their PayPal digital wallet.
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The Massachusetts Mutual Life Insurance Co., the latest mainstream corporation to dabble in digit assets, has purchased $100 million in Bitcoin for its general investing fund. NYDIG, which provides cryptocurrency services to institutions, also received a $5 million minority equity position from the mutual insurer. MassMutual’s Bitcoins will be held in custody by NYDIG.
According to MassMutual, the Bitcoin investment will account for 0.04% of the general investment account, which stood at almost $235 billion as of Sept. 30.
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Bitcoin skyrocketed as much as 20% after Elon Musk added the hashtag #bitcoin to his Twitter bio.
In a filing with the Securities and Exchange Commission, the company said it bought the bitcoin for $1.5 billion worth. Tesla also said it will start accepting payments in bitcoin in exchange for its products subject to applicable laws and initially on a limited basis.
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Canada’s main securities regulator has cleared the launch of the world’s first bitcoin exchange traded fund, providing investors greater access to the cryptocurrency that has sparked an explosion in trading interest.
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Tesla’s CEO, Elon Musk, announced that the firm will accept Bitcoin as payment for cars in the United States, a move that contradicts the company’s reputation as an environmentally benign electric vehicle manufacturer. Mr. Musk stated that rather of converting payments to dollars, Tesla will keep the digital currency and handle the crypto transactions internally.
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But just two months later, Tesla Inc. no longer accept Bitcoin to buy cars, as CEO Elon Musk cited long-standing environmental concerns about a rapid reversal in the company’s stance on cryptocurrencies. $BTC plummeted 10 days later to $37,000.
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China has banned financial institutions and payment companies from providing services related to cryptocurrency transactions and warned investors against speculative crypto trading. Under the ban, such institutions, including banks and online payments channels, must not offer clients any service involving cryptocurrencies, such as registration, trading, clearing and settlement. This is also the day $BTC fell to its lowest level since early 2021.
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El Salvador’s President, Nayib Bukele, said during the Bitcoin 2021 conference in Miami that he has presented legislation to the country’s government that would make bitcoin legal tender in the Central American country.
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Bitcoin mining projects in Sichuan, China’s southwest region, have been forced to shut down. Authorities in China’s major bitcoin-producing provinces have stepped up their crackdown on cryptocurrency mining, the latest indicator of the government’s toughening stance on the quickly rising digital asset markets.
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AMC will begin accepting Bitcoin payments for concessions and theater tickets as soon as the end of the year, marking the latest development in AMC’s hard lean into memestock superstardom.
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El Salvador was the first country to legalize Bitcoin as a form of payment. The government went even farther to encourage individuals to utilize bitcoin by offering free bitcoins to those who sign up for its national digital wallet, known as “Chivo,” which translates to “cool” in English. The residency will be awarded to foreigners who invest three bitcoins in the country.
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China declared that all crypto-related transactions will be considered illicit – including services provided to offshore exchanges according to the announcement made by the People’s Bank of China. It added that cryptocurrencies, including Bitcoin and Tether, are not fiat currencies and cannot be circulated.
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The first bitcoin ETF to launch in the United States was ProShares Bitcoin Strategy. The fund, which trades on the New York Stock Exchange under the ticker BITO, uses futures contracts traded at the Chicago Mercantile Exchange to monitor Bitcoin (BTCUSD) prices (CME).
Bitcoin has risen to a new high a day after the first bitcoin exchange-traded fund was established on Wall Street, generating significant demand in an indication of the asset class’s burgeoning investor interest.
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El Salvador plans to build the world’s first “Bitcoin City”, funded initially by $1 billion worth of Bitcoin-backed bonds. President Nayib Bukele the city planned in the eastern region of La Union would get geothermal power from a volcano and not levy any taxes except for value-added tax (VAT).
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Officials at the Federal Reserve bolstered its fight against the highest inflation in a century by altering their asset-buying program’s end date and hinting that they prefer hiking interest rates faster than expected in 2022.
This announcement sends a negative message to the financial markets in general, and Bitcoin in particular. When there is a scarcity of money and interest rates rise. Rather than investing, investors take money out of their accounts to pay interest. Resulting in a capital deficit in the market.
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The Federal Reserve approved its first rate hike in more than three years, an incremental move intended to tackle rising inflation without powering economic growth.
This low is quite low compared to market expectations, so BTC price does not have much reaction.
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The Federal Reserve raised its benchmark interest rate by half a percentage point, the strongest step in its fight against high inflation in 40 years. And the Fed chair, Jerome Powell, also said there will be more 0.5-point increases this year.
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A liquidity crisis at cryptocurrency firm Celsius has investors worried about a general contagion that could bring down other major players in the market. Because this Lending project holds a lot of loans from big funds in the market like Three Arrow, and Amber Group.
After this news was announced. BTC price plummeted from $28,000 to $22,000. Approximately 20% off.
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The Federal Reserve raised its benchmark interest rate three-quarters of a percentage point in a move comparable to its biggest hike since 1994.
Ending weeks of speculation, the Federal Open Market Committee’s rate-fixing rate brought its benchmark fund rate to 1.5%-1.75%, the highest since just before the Covid pandemic began. beginning in March 2020.
Contrary to what many people expect. BTC price rallied again one day after the news was announced.
This correction does not mean the market’s recovery. The tightening monetary policy has started to be activated and there will be more interest rate hikes this year to bring inflation back to 2% as expected. Therefore, the selling force of BTC will continue in the near future.
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The above are the major events that have taken place in the market from 2020 to now and strongly influenced the price of BTC. If you have any questions, comments, suggestions, or ideas about the project, please email ventures@coincu.com.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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CoinCu Ventures
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