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Transition to Web3 - Course 2 | Transactions and Bitcoin

Bitcoin has been built with many groundbreaking ideas. Its unique mechanisms kindled a whole new financial phenomenon in the world. So far, we have only seen the beginning of the story. 

In the early days, it started off as a digital currency with very low value. In 2010, the first known commercial transaction occurred when programmer Laszlo Hanyecz bought two Papa John's pizzas for 10,000 bitcoin.

One of its first major users were black markets such as Silk Road. In 30 months, Silk Road accepted 9.9 million bitcoins of transactions (worth $214 million at the time).

In 2011, one bitcoin's value started off at $0.30 and rose to above $10. In 2013, its value rose to $770. In 2017, its value rose from $998 to $19,783. It continued to increase in value and surpassed $60,000, though later decreased.

14 years after Satoshi wrote the white paper, Bitcoin started to become part of the global financial system. Today (in December 2022), Bitcoin's total market capitalization is $330 billion. It inspired many other cryptocurrencies and blockchain systems. Global cryptocurrency market capitalization is $904 billion. Bitcoin ETFs (exchange-traded fund) were approved and became part of mainstream investment portfolios. Cryptocurrencies became a common investment vehicle for millions of people around the world. Bitcoin became a legal tender in El Salvador. Iran has used bitcoins to bypass sanctions.

However, it is not without controversy. 

It has been described as an economic bubble by at least eight Nobel laureates. Bitcoin mining is estimated to be responsible for 0.1% of world greenhouse gas emissions. 

Amidst so much uncertainty, there are two things we can be sure of two things: Bitcoin kickstarted the whole blockchain revolution and we have only seen the beginning of the story.

In the next modules, we will explore different aspects of this technology and newer technologies it enabled.

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