Each day, new cryptocurrencies are created and brought online to strengthen the influence of cryptoassets worldwide.
In fact, more and more sports clubs such as Arsenal FC have launched their own cryptocurrencies. Digital technology giants such as Facebook have also announced that their crypto-currencies will soon be online.
But when did cryptocurrencies first appear ? This article will shed some light on this question.
Virtual Currency : The Precursor to Cryptocurrency
The first idea of a digital currency that could be used online is as old as the first years of the decentralised internet. Indeed, many computer engineers tried in the 1990s to bring virtual currencies online. But very soon they were confronted with the problem of double spending. In order to be secure and reliable, a digital currency must, among other things, only be usable once. This is to prevent counterfeiting and replication.
As early as 1998, a decade before the first crypto-currency went online, Wei Dei, a computer engineer, introduced the concept of “B-money”. He outlined the concept in an article he published. For him, B-money should be a completely digital currency that can be sent between users who are known only by a pseudonym. This, he said, would ensure the untraceability and autonomy of the currency.
In the same year, Nick Szabo, a pioneer in blockchain technology, initiated his own electronic currency project. A project he called : Bit Gold. Nick Szabo wanted to create a digital currency that was completely independent of the traditional financial system. For him, his electronic currency should reduce the level of trust needed to make transactions. Decentralised and accessible online, this currency should also revolutionise the use of metal in the creation of coins.
Unfortunately, neither the B-money nor the Bit Gold will make it past the project stage. Neither has ever been officially launched.
Bitcoin : the first cryptocurrency
If Bitcoin is popular and can be bought and sold on trading platforms, it is probably because the cryptocurrency as it is known today is largely the work of Satoshi Nakamoto. Although the real identity of this computer engineer remains a mystery to this day, the Bitcoin white paper he published remains the benchmark for most crypto-currencies in circulation.
Entitled “Bitcoin: A Peer-to-Peer Electronic Payment System”, the publication of this white paper in 2008 was a turning point in the emergence of cryptocurrencies. Four months after its publication, in 2009, Satoshi Nakamoto officially began mining the first block of the Bitcoin blockchain.
This first block, which marked the genesis of Bitcoin and arguably directly of cryptocurrencies, is known as “Genesis”. Some time after the official launch of the cryptocurrency project, Laszlo Hanyecz will make the first purchase of goods for Bitcoin. It was two pizzas for a value of 10,000 BTC. Every year, the anniversary of this purchase is commemorated as : Bitcoin Pizza Day.
Today, Bitcoin remains the first and most valuable cryptocurrency. Most of the cryptocurrencies that have emerged after it were inspired by its model. It is recognised as the most reliable cryptocurrency. In fact, after its meteoric rise, another cryptocurrency was derived from it: Bitcoin Cash. This offers more consistent blocks and is faster to mine than Bitcoin itself.
The success of the Bitcoin project marked the official appearance of cryptocurrencies. Although crypto-currencies are subject to constant volatility, they have succeeded in decentralising the monetary system while breaking free from the traditional financial system.
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