Bitcoin just hit $100,000, but how did it get there?

By reaching the lauded $100,000 mark this morning, the cryptocurrency has officially skyrocketed by more than 159% since a low of $38,505 earlier this year. It is the largest cryptocurrency by far with a market cap of around $2 trillion, according to CoinMarketCap—more than the GDP of Spain.

Bitcoin made an initial feint at $100,000 on November 25 but pulled back at just over $98,000 amid massive profit-taking by longtime holders, according to analytics company Glassnode. It achieved the $98,000-plus mark again on Thanksgiving Friday, before falling back.

After taking another breather, however, BTC finally made it above $100,000 today. The new record high appears to have been triggered by President-elect Donald Trump announcing he had selected Paul Atkins, a pro-crypto candidate, to lead the Securities & Exchange Commission. Atkins will replace current SEC Chair Gary Gensler, who earned the ire of the crypto world by bringing multiple lawsuits against crypto companies..

Yet, the digital coin wasn’t always riding high. Through more than a decade of ups, downs, crashes, and euphoric highs, the coin persisted and has now reached the six-figure threshold that few, barring true Bitcoin believers, ever expected.

How did we get here?

The origin of Bitcoin

The idea for Bitcoin was proposed by an anonymous individual or group of individuals by the name of Satoshi Nakamoto during the 2008 recession. In a white paper, Nakamoto laid out his vision for a peer-to-peer currency that existed outside of the control of major financial institutions and governments. 

Using new technology called the blockchain, Nakamoto created a digital coin enabled by miners who help run a transparent public ledger where everyone could observe transactions as they occurred. In 2009, the first block was mined on the Bitcoin blockchain.

Because Bitcoin has a limited supply of 21 million coins and a mechanism that halves the reward for miners around every four years, the asset is deflationary—meaning each new token gets more expensive—and many have turned to it as a store of value, similar to gold.

The first famous Bitcoin transactions 

But it was a slow start at first for the newly created digital money. While the cryptocurrency attracted followers and developers to help it grow, it still wasn’t worth very much, and it was scarcely accepted as a real currency anywhere.

On May 22, 2010, Florida resident Laszlo Hanyecz made a deal with another user on a Bitcoin forum to accept Bitcoin for pizza. In what would later become one of the most infamous bitcoin transactions, Hanyecz sent the forum member 10,000 Bitcoin, worth about $41 at the time, for two pizzas worth about $25, according to Benzinga. The 10,000 Bitcoin would be worth about $1 billion at today’s new record price. 

In 2019, Hanyecz told 60 Minutes he wasn’t too upset about what now looks like a lopsided deal. The crypto community still commemorates every May 22 as “Bitcoin Pizza Day,” and Hanyecz is more than OK with it.  

“It’s pretty cool to have a holiday in my honor,” he told 60 Minutes.

Earning some recognition 

In 2012, the first halving of Bitcoin sent mining rewards down and slowed the supply of coins. By 2013, the price of Bitcoin surpassed $100 for the first time. 

At this time, financial regulators started taking notice of the upstart currency—but not always in a good way. Many regulators and financial bigwigs, like JPMorgan CEO Jamie Dimon, saw the digital currency as being limited to facilitating illicit transactions. They noted that it was heavily used on the anonymous black market platform Silk Road, created by Ross Ulbricht, who was known online as “Dread Pirate Roberts.” The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) also issued its first guidelines on digital currencies in 2013, putting users on notice that transactions in Bitcoin might attract law enforcement attention. China banned financial institutions from using Bitcoin that same year.

Bitcoin’s first boom

Due in part to the 2014 collapse of the Mt. Gox crypto exchange—the biggest of its time—the cryptocurrency saw a wave of skepticism and selloffs. But Bitcoin saw its first hint of a boom in 2017, when its price broke $19,000 for the first time.

Institutions also started dipping their toe into the crypto world. In 2017, the first ever futures contract traded on the Chicago Board Options Exchange overwhelming the CBOE website. Later that year, the Chicago Mercantile Exchange also launched its own Bitcoin Futures contract.

Another tailwind during this time was the ICO (initial coin offering) boom. Myriad new digital coins—not necessarily related to Bitcoin—sprung up and many investors bought in to speculate. Yet, while many of those coins later vanished, Bitcoin, as the original cryptocurrency with solid mechanisms to protect its value, stayed around, though by 2018 its price was (again) on a downward spiral. 

The pandemic Bitcoin rush 

In 2020, Michael Saylor, cofounder and then-CEO of MicroStrategy, started quietly stockpiling Bitcoin through his business intelligence company. MicroStrategy first put $250 million into the coin, but since then has poured much of its cash into the asset, and its holdings now amount to at least $30 billion.

Then Bitcoin saw another boom in 2021, after the pandemic kept people in their homes, where they naturally gravitated to meme stocks and digital currencies. The coin reached a record high at the time of $60,000 and attracted new investors such as Elon Musk’s Tesla and the country of El Salvador, led by president Nayib Bukele, a Bitcoin enthusiast. El Salvador now reportedly owns more than $500 million of Bitcoin.

Why is Bitcoin going up now?

The coin got a boost in January of this year after the Securities and Exchange Commission approved the first spot Bitcoin exchange-traded funds (ETFs), which directly track the price of the cryptocurrency. The ETFs have helped push Bitcoin’s price up by making it much more accessible to retail investors more comfortable dealing with traditional financial institutions.

In recent weeks, Bitcoin’s price has exploded, especially after Donald Trump won the U.S. presidential election. Investors expect that Trump will be more friendly to cryptocurrency, a marked change from the often antagonistic stance adopted by Gensler, the Biden Administration’s SEC chairman. 

Among Trump’s Bitcoin-friendly proposals are a “strategic Bitcoin reserve” and creating a crypto advisory council that could include top U.S. crypto companies. Trump’s tariff proposals have also possibly sent investors flocking to store of value assets such as Bitcoin as a hedge against inflation.