Bitcoin’s Price History

Among asset classes, Bitcoin has had one of the more volatile trading histories. The cryptocurrency’s first big price increase occurred in 2010 when the value of a single bitcoin jumped from just a fraction of a penny to $0.09.

The cryptocurrency has undergone several rallies and crashes since it became available. Learn more about Bitcoin’s volatility and some reasons why its price acts the way it does.

Bitcoin Price History

The price changes for Bitcoin alternately reflect investor enthusiasm and dissatisfaction with its promise. Satoshi Nakamoto, the anonymous Bitcoin inventor(s), designed it for use as in daily transactions and a way to circumvent traditional banking infrastructure after the 2008 financial collapse.

The cryptocurrency gained mainstream traction as a means of exchange and attracted traders who began to bet against its price changes. Investors turned to it as a way to store value, generate wealth, and hedge against inflation; institutions worked to create Bitcoin investment instruments.

Bitcoin price fluctuations primarily stemmed from investors and traders betting on an ever-increasing price without much grounding other than anticipation of riches. But Bitcoin’s price story has again changed. In January 2022, Bitcoin began losing steam.

Here’s a quick rundown of Bitcoin’s past:

2009–2015

Bitcoin had a price of zero when it was introduced in 2009. On July 17, 2010, its price jumped to $.09. Bitcoin’s price rose again on April 13, 2011, from $1 to a peak of $29.60 by June 7, 2011, a gain of 2,960% within three months. A sharp recession in cryptocurrency markets followed, and Bitcoin’s price bottomed out at $2.05 by mid-November. The following year, its price rose from $4.85 on May 9 to $13.50 by Aug. 15.

2012 proved to be a generally uneventful year for Bitcoin, but 2013 witnessed strong gains in price. It began the year trading at $13.28 and reached $230 on April 8; an equally rapid deceleration in its price followed, bringing its price down to $68.50 a few weeks later on July 4.

In early October, Bitcoin was trading at $123.00; by December, it had spiked to $1,237.55 and fell to $687.02 three days later. Bitcoin’s prices slumped through 2014 and touched $315.21 at the start of 2015.

2016–2020

Prices slowly climbed through 2016 to over $900 by the end of the year. In 2017, Bitcoin’s price hovered around $1,000 until it broke $2,000 in mid-May and then skyrocketed to $19,345.49 on Dec. 15. Mainstream investors, governments, economists, and scientists took notice, and other entities began developing cryptocurrencies to compete with Bitcoin.

Bitcoin’s price moved sideways for the next two years with small bursts of activity. For example, there was a resurgence in price and trading volume in June 2019, with prices surpassing $10,000. However, it fell to $6,635.84 by mid-December.

In 2020 the economy shut down due to the COIVD-19 pandemic—Bitcoin’s price burst into activity once again. The cryptocurrency started the year at $6,965.72. The pandemic shutdown and subsequent government policies fed investors’ fears about the global economy and accelerated Bitcoin’s rise. At close on Nov. 23, Bitcoin was trading for $19,157.16. Bitcoin’s price reached just under $29,000 in December 2020, increasing 416% from the start of that year.

2021–Present

Bitcoin took less than a month in 2021 to smash its 2020 price record, surpassing $40,000 by Jan. 7, 2021. By mid-April, Bitcoin prices reached new all-time highs of over $60,000 as Coinbase, a cryptocurrency exchange, went public. Institutional interest further propelled its price upward, and Bitcoin reached a peak of more than $63,000 on April 12, 2021.

By the summer of 2021, prices were down by 50%, hitting $29,619 on July 19. Autumn saw another bull run in September, with prices scraping $52,634, but a large drawdown took it to a closing price of $42,093 about three weeks later.

On Nov. 10, 2021, Bitcoin again reached an all-time high, $68,493 before closing at $68,205. In mid December 2021, Bitcoin fell to $46,421 before fluctuating more as uncertainty about inflation continued to spook investors alongside the emergence of a new variant of COVID-19, Omicron.

Between January and May 2022, Bitcoin’s price continued to gradually decline, with closing prices only reaching as high $46,662 in April before falling further. On May 11, Bitcoin closed at $28,757, its first time closing under $30,000 since July 2021.

Which Factors Influence Current Bitcoin Price?

Like other currencies, products, or services within a country or economy, Bitcoin and other cryptocurrency prices depend on perceived value and supply and demand. If people believe that Bitcoin is worth a specific amount, they will pay it, especially if they think it will increase in value.

By design, there will only ever be 21 million Bitcoins created. The closer Bitcoin gets to its limit, the higher its price will be, as long as demand remains the same or increases.

Bitcoins are created by mining software and hardware at a specified rate. This rate splits in half every four years, slowing down the number of coins created. Following the laws of supply and demand, Bitcoin’s price should continue to rise as its supply may not be able to meet its demand—as long as it continues to grow in popularity. However, if popularity wanes and demand falls, there will be more supply than demand, and Bitcoin’s price should drop unless it maintains its value for other reasons.

Another factor that affects Bitcoin’s price falls in line with supply and demand; Bitcoin became an instrument that investors and financial institutions used to store value and generate returns. Derivatives have been created and traded by brokers, investors, and traders, which acted to influence Bitcoin’s price further. Speculation, investment product hype, irrational exuberance, or investor panic and fear can also be expected to affect Bitcoin’s price because demand will rise and fall with investors’ sentiments.

Other cryptocurrencies may also affect Bitcoin’s price. There are several cryptocurrencies, and the number continues to rise as regulators, institutions, and merchants address concerns and adopt them as acceptable forms of payment and currency. Lastly, if consumers and investors believe that other coins will prove to be more valuable than Bitcoin, demand will fall, taking prices with it—or demand will rise, along with prices, if sentiments change in the opposite direction.

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