On May 22, 2010, Laszlo Hanyecz paid Jeremy Sturdivant 10,000 bitcoins for two Papa John’s pizzas, which Sturdivant later delivered to Hanyecz’s home. The significance of this transaction is the first known instance where bitcoin was used as a medium of exchange in commerce. 🔥
Bitcoin Pizza Day is often accompanied by a cry: “Wow, that guy is dumb. If he kept those bitcoins, today they’d be worth more than $270 million! Instead, he just got two pizzas.” However, is that true? Although it is arguably a fortune today, in 2010, 10,000 BTC was only worth approximately two pizzas. In order for it to appreciate, it needed to be used, which is why May 22 is so important.
The general rationale also applies, however, bitcoin’s outrageous gains have allowed for such statements. Here is a relevant hypothetical statement: It will be implied that, for example, a tech company with four co-founders hires its first employee, offering $50,000 annually and 1 percent of the company’s stock, but the company today is worthless. The employee quits after a one-year holiday. If the company goes public eight years later and becomes a social media behemoth, I will be charged from $50,000 to $1 billion. This statement seems unfair. 😊
Conversely, indeed, Hanyecz did not pay $270 million for pizza but 10,000 bitcoins because the value of the coin was only known at the time.
