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In 2010, a year after the first bitcoins were generated, twenty-five dollars worth of pizza cost around ten thousand bitcoins. By the time The New Yorker first wrote about Bitcoin, in October, 2011, the electronic currency was worth about five dollars per bitcoin, down from the thirty-dollar highs of that summer.
Today, a single bitcoin is worth a hundred and forty-one dollars. There are around eleven million in circulation; twenty-five new bitcoins are produced every ten minutes. The value of the currency has risen astronomically in a short period of time—it’s increased by a factor of ten this year alone—driven by uncertainty about the euro, coupled with new regulations from the Financial Crimes Enforcement Network that solidifies the legal standing of Bitcoin, as Maria Bustillos explains in depth. (The secret to its value, writes Paul Ford, is “trust.”)
This graph shows how the price of bitcoins has changed since their inception:
With such volatility, no one is really sure where the value of bitcoins will go from here. (Gavin Andresen, the chief scientist for the Bitcoin Foundation, stresses that it is still an “experiment.”) Business Insider’s Henry Blodget, who Ken Auletta profiled in the magazine this week, thinks the worth of bitcoins could end up anywhere from zero dollars to several thousand per bitcoin.
For more business news and analysis, visit The Business Pages.
KEYWORDS BITCOIN; BIZPAGES; ELEMENTS
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