Twelve years ago today, a Bitcoin user under the pseudonym NewLibertyStandard posted what is likely to be the first Bitcoin price in US dollars.
On his website of the same name, NewLibertyStandard went on to explain how the 2009 exchange rate was formulated:
During 2009, my exchange rate was calculated by dividing $1.00 by the average amount of electricity required to run a computer with a high CPU for a year, 1331.5 kWh, multiplied by the average residential cost of electricity in the United States For the previous year, $0.1136, divided by 12 months divided by the number of bitcoins generated by my computer over the past 30 days.”
Pricing Bitcoin in dollars is great because it indicates the first sign of demand for the asset, or one methodology of how the exchange’s dynamism appears. This theoretical price indicates the following:
Someone in the market was willing to give up $1 for 1,309.03 BTC, because they valued that amount of Bitcoin at more than $1. On the contrary, the counterparty at the time (in this case probably NewLibertyStandard as well) was willing to trade 1,309.03 BTC for $1, because they valued Bitcoin at less than $1. The price of 1 BTC was $0.00076392.
On October 6, 2009, the price of Bitcoin rose on the NewLibertyStandard scale. At the moment that day, the price of 1 BTC was $0.00088454.
At the time of writing, 1 BTC costs around $49,880.00.
Let’s compare:
October 5, 2009: 1 Bitcoin = $0.00076392
October 5, 2021: 1 Bitcoin = $49,880.00
49880.00 – 0.00076392 = 49879.9992
49,879.9992 / 0.00076392 = 65,294,794.3
65,294,794.3 * 100 = 6,529,479,430%
Bitcoin is up 6,529,479,430% since it was first priced in US dollars. Bitcoin is the most valuable asset in human history.
