The price of a single Bitcoin rose to six figures for the first time, an extraordinary level for a 16-year-old cryptocurrency once dismissed as a sideshow.
In May 2010, Laszlo Hanyecz, an early cryptocurrency enthusiast, used Bitcoin to buy two pizzas from Papa John’s. He spent 10,000 Bitcoins, or roughly $40 at the time, in one of the first purchases ever made with the digital currency.
It has turned out to be the most expensive dinner in history.
On Wednesday, the price of a single Bitcoin rose to more than $100,000, a remarkable milestone for an experimental financial asset that had once been mocked as a sideshow and a fad. The total cost of those pizzas today: $1 billion.
Bitcoin now stands as arguably the most successful investment product of the last 20 years. The value of all the coins in circulation is $2 trillion, more than the combined worth of Mastercard, Walmart and JPMorgan Chase. The motley assortment of hackers and political radicals who embraced Bitcoin when it was created by an anonymous coder in 2008 have become millionaires many times over. And the invention has spawned an entire industry anchored by publicly traded companies like Coinbase, a cryptocurrency exchange, and promoted by celebrities, athletes and Elon Musk.
Even the president-elect says he is a believer. During the campaign, Donald J. Trump marketed himself as a Bitcoin enthusiast, vowing to create a federal stockpile that could push its price even higher.
Bitcoin began as “essentially an experimental hobbyist project,” said Finn Brunton, the author of a 2019 book about the history of cryptocurrency. “To see where it is now is to see a really impressive feat.”
Bitcoin’s rise to $100,000 signals its now-undeniable status in the global economic system. The virtual currency has become a staple of financial markets, embraced by Wall Street giants and amateur investors alike. Its surge also caps an astonishing turnaround after its price dropped below $17,000 in 2022, as the collapse of the FTX crypto exchange sent the industry into a tailspin.
This year, Bitcoin has come roaring back. Federal regulators allowed Wall Street firms to offer a popular financial product tied to the coin, attracting billions of dollars in fresh investment. Then, Mr. Trump’s election victory sent its price even higher, as crypto enthusiasts branded him the first “Bitcoin president.”
In a matter of months, Bitcoin investors went from bemoaning tough regulation under the Biden administration to shopping for Lamborghinis and gloating on social media. Top crypto executives spent about $135 million to influence the U.S. election, and they are now enjoying the spoils.
Last month, Gary Gensler, the chairman of the Securities and Exchange Commission and a crypto critic who had led a crackdown on the industry, said he would step down on Jan. 20. A few hours before Bitcoin hit its milestone, Mr. Trump picked Paul Atkins, a former regulator and founder of a financial consulting firm, as the next S.E.C. leader. Mr. Atkins has advised a crypto industry group, and is viewed as an advocate for digital assets.
“There’s an enormous amount of excitement in the industry right now,” said Jeremy Allaire, the chief executive of Circle, an influential U.S. crypto company. “A lot of positive energy.”
Still, Bitcoin remains prone to extreme volatility. Its price sometimes drops when the global economy struggles. Environmental groups have raised concerns that the energy required to run Bitcoin’s software contributes to climate change, and the technology has long been used by scammers and thieves.
While some of that illicit activity has fallen off, cybercriminals used digital currencies to facilitate about $500 million in ransom payments over the first six months of the year, according to the crypto forensics firm Chainalysis.
Before it became a cultural and financial phenomenon, Bitcoin was just an idea sketched out in a nine-page white paper posted on an internet mailing list on Halloween in 2008. The author was a mysterious coder who used the pseudonym Satoshi Nakamoto. At its most basic, Satoshi’s vision was a type of digital money that people could exchange without relying on banks to process the transfers. Every transaction would be recorded on a publicly visible ledger known as a blockchain.
Early enthusiasts envisioned Bitcoin as the foundation for a new kind of financial system that would be governed by code and exist outside the supervision of Wall Street firms and government regulators. They also viewed Bitcoin as a long-term store of value — it was programmed to have a fixed supply, so it would be resistant to inflation.
The Wall Street establishment dismissed Bitcoin as a passing trend and a tool for criminals. Jamie Dimon, the chief executive of JPMorgan Chase, called Bitcoin “a fraud” and a “Ponzi scheme.” Mr. Trump once decried it as “a scam” devised to undermine the U.S. dollar.
But believers thought Bitcoin might someday facilitate real-world transactions. On May 18, 2010, Mr. Hanyecz posted in a popular Bitcoin forum, offering to send 10,000 Bitcoins to anyone who ordered him pizza from Papa John’s. “Like maybe 2 large ones so I have some left over for the next day,” he wrote.
A deal was struck, and the event became known as Bitcoin Pizza Day. Over the next decade, Bitcoin inspired thousands of other digital currencies with names like Ether, Solana and Dogecoin, some of which also became enormously valuable.
In November 2021, Bitcoin’s price soared to nearly $70,000, setting a record. The crypto world was ascendant. Kim Kardashian encouraged her Instagram followers to buy the coins, and athletes like Tom Brady and Steph Curry promoted crypto companies in splashy television commercials.
Then the bubble burst. In 2022, FTX and other prominent crypto firms filed for bankruptcy, causing the prices of Bitcoin and other digital assets to plummet by as much as 96 percent. Amateur investors who had poured money into crypto saw their savings vanish. In Washington, Mr. Gensler of the S.E.C. embarked on a wide-ranging clampdown.
But the industry’s fortunes changed again this year, after the S.E.C. lost a court battle to block a new financial product tied to Bitcoin. In January, major Wall Street firms, including BlackRock, Franklin Templeton and Fidelity, started offering exchange-traded funds linked to Bitcoin, attracting a wave of investment. Bitcoin’s price skyrocketed to another record in March.
Wealthy investors who had held onto their Bitcoin became even richer. Michael Saylor, the chief executive of the software firm MicroStrategy, had been widely mocked for borrowing hundreds of millions of dollars to buy Bitcoin for his company. Now his stash is worth more than $30 billion.
On the campaign trail, Mr. Trump proclaimed himself a Bitcoin enthusiast, promising to fire Mr. Gensler and end the S.E.C.’s crackdown. A few weeks before the election, Mr. Trump and his sons started their own crypto business, World Liberty Financial, putting the family in a position to benefit personally from softer regulations.
Suddenly, a financial asset designed to circumvent the U.S. government was surging in value because a U.S. presidential candidate had embraced it.
Bitcoin has risen in “exactly the opposite way that it was intended,” said Mr. Brunton, the crypto author. “By being something where its real value comes from its association with a politician and a state actor.”
