Author: 636Marx
The symbol for Bitcoin is a 'B' with two vertical lines added, similar to the dollar sign '$' with an additional line. BTC is the world's first truly decentralized digital currency, marking a remarkable shift from niche digital experiments to global financial power. The journey from a few cents to $100,000 reflects fundamental shifts in technology, finance, and collective psychology. This article will explore the key events and catalysts behind Bitcoin's most significant price breakthroughs, outlining the development trajectory from five-figure to six-figure values.
1. Bitcoin's first $10,000 milestone, an integer breakthrough.
In November 2017, Bitcoin first broke through $10,000, marking its official entry into mainstream finance. This milestone transformed Bitcoin from a geek exploration object into a globally recognized digital asset, drawing the attention of institutional investors for the first time.
Key Drivers
1. Mainstream Awareness: Bitcoin's rapid rise in 2017 attracted public attention, with media coverage fueling widespread interest in crypto investments.
2. Infrastructure Development: Platforms like MT.gox, Huobi, Coinbase, and OKex have streamlined the purchasing and wallet usage processes for ordinary users, making Bitcoin more accessible.
3. Speculative Frenzy: Driven by FOMO (fear of missing out), a large number of retail investors flooded into the market, pushing prices higher.
Despite reaching this milestone, Bitcoin still faces significant challenges. Mainstream media considers it a speculative bubble, while uncertainty in government regulation and price volatility keep institutional investors on the sidelines.
2. The first major bull market for Bitcoin, $20,000.
At the end of 2017, Bitcoin soared from $10,000 to $20,000, going through a period of intense speculation. Although the price doubled in just a few weeks, this rise lacked solid fundamental support.
Key Drivers
1. ICO Frenzy: Blockchain startups have followed the stock market's IPOs with ICOs (Initial Coin Offerings). Most projects use Bitcoin as the primary investment medium because there is no 'illegal gathering' in Chinese law.
2. Market Sentiment: Crypto investment began expanding from first-tier cities to third- and fourth-tier cities, forming a self-reinforcing upward cycle of optimistic expectations and bullish sentiment.
3. Volatility: After nearing $20,000 in December 2017, Bitcoin entered a prolonged bear market, with over 80% of its market value evaporating in 2018.
4. Regulatory Tightening: Governments worldwide have increased regulation of ICOs and digital currencies.
On September 4, 2017, the People's Bank of China announced that ICOs were illegal financial activities and required related exchanges to close. After the project leaders of cryptocurrency were summoned, the market reacted strongly to the government's determination to ban cryptocurrencies, resulting in a price crash. Beijing's regulators demanded exchanges close by 24:00 on the 15th, and on the 14th Binance's BTC dropped over 20%, falling to $2,817 on the 15th.
3. Bitcoin Breaks Through Upward Bottleneck, Institutional Entry.
In December 2020, Bitcoin approached $20,000 for the second time, fundamentally different from the speculative frenzy of 2017. This rise was driven by institutional interest and macroeconomic factors.
Key Drivers
1. Institutional Adoption: Large companies like MicroStrategy and Tesla have incorporated Bitcoin into their balance sheets, validating its long-term value proposition.
2. Halving Effect: The third halving in May 2020 reduced Bitcoin's inflation rate, creating upward momentum.
3. COVID-19 Pandemic: Economic uncertainty and unprecedented monetary stimulus prompted investors to view Bitcoin as an inflation hedge.
4. Volatility Opportunities: As Bitcoin’s price exhibited significant cyclical volatility, it attracted many long-term and cyclical investors.
A Chinese company that DIYs Bitcoin mining machines successfully listed on NASDAQ on November 21, 2019, at 23:00 Beijing time. The IPO opening price rose 40%, with a market value exceeding 10 billion RMB. The author believes that before the emergence of Bitcoin ETFs, mining was the primary source of capital inflow for Bitcoin. Zhang Nengeng's Canaan Creative surpassed Wu Jihan's Bitmain, becoming the first stock in the blockchain industry!
4. From $30,000 to $60,000: Retail Enthusiasm and Corporate Recognition.
From January to April 2021, Bitcoin quickly rose from $30,000 to over $60,000, with retail investor enthusiasm and institutional acceptance progressing simultaneously.
Key Drivers
1. Tesla Investment: Tesla's $1.5 billion investment in Bitcoin and its brief acceptance of Bitcoin payments enhanced the legitimacy of digital currencies.
2. Social Media Momentum: The 'Laser Eyes' movement on X (formerly Twitter) received widespread response from retail investors.
3. ETF Progress: Bitcoin futures ETFs are gaining traction, indicating a more open regulatory attitude.
In 2021, the country explicitly banned Bitcoin mining. On May 12, 'crypto KOL' Elon Musk stated on X that due to concerns about the rapid increase in fossil fuel use in Bitcoin mining, Tesla had 'suspended vehicle purchases using bitcoin.' After Musk announced this news, Bitcoin began to decline within minutes, suggesting he was trying to influence Bitcoin's price.
5. Bitcoin Breaks Through $70,000 Bottleneck Again: Inflation and Hedging.
In November 2021, Bitcoin approached $69,000, with its status as an inflation hedge and safe-haven asset strengthened during periods of geopolitical uncertainty.
Key Drivers
1. Inflation Concerns: Rising global inflation highlights Bitcoin's value as a deflationary asset.
2. Institutional Products: The US approved Bitcoin futures ETFs, broadening traditional investment channels.
3. Geopolitical Events: The Russia-Ukraine conflict highlights Bitcoin’s value as a censorship-resistant asset.
On February 24, 2022, political maneuvers targeting NATO's sixth eastward expansion failed, igniting a two-and-a-half-year-long Russia-Ukraine war. The West donated hundreds of millions of dollars in Bitcoin to Zelensky, with clear records of over $80 million donated. Russia had $300 billion in sovereign assets frozen, equivalent to 20.27% of its GDP that year. Russia even showcased military Bitcoin mining farms on (Red Star TV). The ongoing Russia-Ukraine war has become a trench warfare, with no clear end in the next two and a half years.
6. Bitcoin $100,000 Babel: Freedom and Greed.
At the time of writing, Bitcoin had reached $99,419.99, as it neared the $100,000 mark, multiple factors indicated that the realization of this milestone was based on more than mere speculation.
Key Drivers
1. Spot Bitcoin ETF: Potential approval of a spot ETF could unleash trillions of dollars in institutional funds.
2. 2024 Halving: The halving in April 2024 will further tighten Bitcoin's supply, catalyzing a new bull market.
3. Global Adoption: El Salvador and the Central African Republic have made Bitcoin legal tender, paving the way for wider acceptance.
4. De-dollarization: Countries seeking alternatives to the US dollar adopt Bitcoin for international trade and reserves.
The Tower of Babel comes from the first book of the Christian Old Testament, where humanity builds a tower to reach heaven. Ultimately, the shortcut to heaven was destroyed by language and ambiguity. Bitcoin is Satoshi Nakamoto's attempt to eliminate currency inflation and the cyclical risks of the banking system.
The first user of Bitcoin was programmer Laszlo Hanyecz on May 22, 2010, who used 10,000 BTC to buy 2 pizzas. The first large-scale use was on the dark web 'Silk Road' in February 2011, where Bitcoin was used for various illegal transactions. The dark web 'Silk Road' was dismantled by the FBI in October 2013, with a staggering transaction volume of $214 million. This was remarkable as Bitcoin was mostly around $10 per coin at that time. According to later statistics, the total sales volume of 'Silk Road' was about 9.52 million Bitcoins.
Today, Bitcoin has gained recognition from large public companies and multinational corporations. Its infinite divisibility, packaging of Bitcoin, and the emergence of altcoins are creating new inflation. Periodic halving, crypto KOLs, and institutional investors continuously generate new systemic financial risks in Bitcoin.
The author saw in Stavridis' (Global History) that humans completed migration across 7 continents 50,000 years ago, yet the Silk Road in China only appeared during the Western Han Dynasty. As stated in the Old Testament — a land flowing with milk and honey, a group of people speaking a single language — it just happened in the ancient East.
The author believes: the strategy of 'this group of people speaking a single language' towards Bitcoin is the correct one. The World Bank has pointed out in reports that 'Bitcoin was not a deliberate Ponzi scheme.'
The author believes: Bitcoin is a cross-border pyramid scheme.
