After 9 years and a $250 bn market cap, Bitcoin still awaits legal status

Bitcoin has had global central banks so worried that several are now mulling regulating the currency, legalising it, or evolving their own crypto currencies

Bitcoin, the most talked about crypto currency, has entered the tenth year of its existence today.

Nine years ago on this day, Satoshi Nakamoto, founder of the world’s first and thus far biggest crypto currency had launched the Bitcoin network by creating the "genesis block," the first entry in Bitcoin's global transaction register. It includes the following text: "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks."

This was a time when global central bankers were announcing quantitative easing and packages for bailing out banks that took huge hits during the debt-financial crisis of 2008. On October 31, 2008, Nakamoto published a design paper or white paper through a metzdowd.com cryptography mailing list that describes the Bitcoin currency and solves the problem of double spending, so as to prevent the currency from being copied.

Nakamoto wanted to introduce a democratic currency that isn't controlled by any central bank, as the global financial crisis that year had virtually seen the whole world burn its fingers. He had said that Bitcoin would be “a purely peer-to-peer version of electronic cash that would allow online payments to be sent directly from one party to another without going through a financial institution.”

He also invented blockchain technology, a public ledger, for bitcoin transfers. According to information on investopedia, on January 3, 2009, an anonymous developer called Satoshi Nakamoto made history when he (or she, or they) released the Genesis Block, the original block containing the first 50 bitcoins, on to Sourceforge. Till date, Nakamoto's identity is unknown. 

But the currency that was launched nine years back and was worth a few cents and produced on a simple computer, now needs graphic cards and high-end computers with high use of power. Over the years it became so popular that several hundreds of such crypto currencies were formed afterwards. Today, these rivals are also becoming popular and have pushed Bitcoin's market share to an all-time low of 36.6 per cent with market cap of $250 billion. Ripple now occupies second spot in market cap in a crypto universe whose total market cap crossed $700 billion this morning. The next stop: a trillion dollar market cap. 

There is a famous story of the world’s costliest pizza bought on May 22, 2010 by Laszlo Hanyecz, a programmer who paid a fellow Bitcoin Talk forum user 10,000 Bitcoin for two of Papa John’s discs. Back then, when the technology was just over a year old, the amount was the equivalent of $25. Today, you would need a high-end calculator to figure out what that meal would be worth in current dollar terms. The reason? Bitcoin is priced of today at $14,900 apiece. Back then, it was worth just 2-3 cents.

Today blockchain is used by three million users every day, with that number expected to increase to 200 million within just seven years, according to projections. Bitcoin has generated so much interest and has had global central banks so worried that several are now considering regulating the currency, legalising it, or even evolving their own crypto currency. 

Japan has already legalised Bitcoin. The Russian central bank plans to produce its own crypto currency, which will be known as crypto rouble. Last week, Belarus legalised crypto currencies. India still officially says bitcoin is not a legal tender, but hasn't categorically called it illegal either. The Indian government is waiting for a report from a committee which is expected offer recommendations on regulating crypto currencies.