On January 3rd, 2009, the Genesis Block was created. This was the first entry on the Bitcoin blockchain. Because of the nature of Bitcoin, all transactions lead back to this block. This is where Bitcoin began, almost exactly ten years ago.
The Genesis Block was created by Satoshi, a person or persons we know nothing about. In the decade since, we’ve seen the astonishing rise and meteoric descent of Bitcoin, and then it happened again after the bubble was re-inflated.
Due to the nature of Bitcoins, blockchains, and ledgers, the entire history of Bitcoin has been recorded. Every coin spent and every satoshi scrupled has been recorded for all to see. It’s time for a retrospective, and not just because I wanted to see some art based on the covers of Now That’s What I Call Music albums. No, ten years is a lot of stories to tell.
The Genesis Device
The entire idea of a blockchain is to record each and every transaction. That’s pretty much the only solution a blockchain solves, and that’s straight from the mouth of the National Institute of Standards and Technology. Because of this, we can trace Bitcoin back to the very beginning. Here it is, Block #0, or Block #1, there was an off-by-one error in the early days, ‘doncha know.
Apart from being the foundation upon which the entire Bitcoin blockchain is built, there is a bit more data in the Genesis Block. The text, “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks” is embedded in the raw block data. There are different interpretations on why this data exists. It could be that Satoshi simply picked up a copy of The London Times and wrote down the headline, just like you would hold up a picture of a newspaper to timestamp a photograph. It could be a comment on a fractional reserve banking system. In any event, if you ever find a copy of The Times from January 3, 2009, you’ve just found half a million dollars. That’s what Bitcoin collectors are asking for a copy of this newspaper.
One Point Five Million Dollar Pizza
At one point, this Papa John’s pizza was worth $750,000. Image credit Laszlo.
It’s a tautology, but Bitcoin is only worth something if it’s worth something. A medium of exchange, if it were. In the early days of Bitcoin, back in early 2010, the community surrounding Bitcoin was a lot like Dogecoin community of 2014. Your Bitcoin program just generated these ‘coins’. No, you couldn’t spend them anywhere. People were collecting Bitcoins, because it was something to do. It was novel. People were giving away Bitcoins for free, just to watch them move around the blockchain.
Then, in May of 2010, something changed. Over on the Bitcointalk forums, Laszlo came upon an agreement with another member. Laszlo would give 10,000 BTC to another forum member for two Papa Johns pizzas. The pizzas were reportedly a large ‘works’ and a large ‘garden fresh’, and cost the buyer between $30 and $40 USD. Before, people were giving each other Bitcoins for a few cents each, but Laszlo’s pizzas are the first time Bitcoin could be assigned a value in a real currency. In this exchange, one Bitcoin was equal to 0.3 cents. At the heights of the Bitcoin bubble, these pizzas would be worth $1.5 Million USD.
Laszlo is famous in the Bitcoin community, and not just because he spent a million dollars on two pizzas. He was one of the first to release a GPU miner, simply as a fun project while learning OpenCL. He mined all his coins on an nVidia 9800 GTX+ / hackintosh rig, later moving on to a 2x Radeon 5970 rig. Your GPU miners, especially the ones running on OS X (however rare that may be) can trace their origin back to the guy who bought a million dollar pizza. The guy that sent him the pizzas? He bought a house with his pizza Bitcoins.
Buy Drugs With Magic Internet Money!
While supporters of Bitcoin say it’s an experiment in economics, the solution to the Byzantine General’s problem, an innovative new technology; this isn’t what the majority of people thought in 2011. The first popular use of Bitcoin, outside weird forums based out of Neckbeardistan, was as a way to buy drugs.
Supporters of Bitcoin will say it was an interesting technology built by some very smart people, and maybe a few entrepreneurs got into the game before cashing out in Puerto Rico. This is a false narrative. The cultural zeitgeist of 2011 and 2012 is that Bitcoin was a way to buy drugs on the Internet. Bitcoin was how you bought drugs on the Internet, full stop. You could buy drugs with Bitcoin on The Silk Road. This was the purpose of Bitcoin (aside from buying pizzas).
The Silk Road was an online market operating on the Tor network. The easiest way for anyone to access the Silk Road was to download a Tor browser, copy and paste the Silk Road address, and look at the amazing variety of products available on the Silk Road. You could buy weed, fentanyl someone stole from their grandmother, zanzibars, heroin — actual heroin, with a…