Bitcoin price history

Among asset classes, Bitcoin has had one of the more volatile trading histories. The cryptocurrency’s first significant price increase occurred in October 2010, when the value of a single Bitcoin began to move beyond its long-standing price of less than $0.10.

The cryptocurrency has undergone several rallies and crashes since it became available. This article provides insight into Bitcoin’s volatility and some reasons why its price behaves the way it does.

Bitcoin price history

The price changes for Bitcoin reflect both investor enthusiasm and dissatisfaction with its promise. Satoshi Nakamoto, the anonymous Bitcoin inventor(s), designed it for use in daily transactions.

Cryptocurrency has gained mainstream traction as a medium of exchange. It also attracted traders who started betting against its price changes. Investors have turned to Bitcoin as a way to store value, generate wealth and hedge against inflation. Institutions have worked to create Bitcoin investment tools.

Bitcoin’s price fluctuations mainly stem from investors and traders hoping for an ever-rising price in anticipation of riches. If you’re considering investing in Bitcoin, be sure to research the best cryptocurrency exchanges and apps first.

Here’s a quick overview of Bitcoin’s price history:

2009–2015

Bitcoin had a price of zero when it was launched in 2009. Its price jumped from its long-held level of $0.10 to $0.20 on October 26, 2010. Before the year ended, it reached $0.30. In 2011, it began to grow past $1, reaching a peak of $29.60 on June 8, 2011; however, a sharp recession in cryptocurrency markets followed, and Bitcoin’s price plummeted, ending the year at $4.70.

The year 2012 was a generally uneventful year for Bitcoin, although it did increase by a few dollars; However, 2013 saw strong increases in price. Bitcoin began the year trading at $13.30, crossed $100 by April, then $200 by October.

The rest of the year witnessed historic gains for Bitcoin. It passed $1,000 in November and ended the year at $805.90.

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 soared to $19,345.49 on December 16.

Mainstream investors, governments, economists, and scientists took note, and other entities began developing cryptocurrencies to compete with Bitcoin.

Bitcoin’s price has moved sideways in 2018 and 2019, with small bursts of activity. For example, there was a resurgence in price and trading volume in June 2019, with the price surpassing $10,000. However, it fell to $6,635.84 by mid-December.

In 2020, the economy shut down due to the COVID-19 pandemic. Bitcoin’s price has burst into action again. The cryptocurrency started the year at $6,965.72. The pandemic shutdown and subsequent government policies fueled investor fears about the global economy and accelerated Bitcoin’s rise.

At the close on November 23, Bitcoin was trading at $19,157.16. Bitcoin’s price reached just under $29,000 in December 2020, increasing by 416% since the beginning of that year.

2021–2023

Bitcoin took less than a month in 2021 to shatter its 2020 price record, surpassing $40,000 by January 7, 2021. By mid-April, Bitcoin prices hit new highs of over $60,000 when Coinbase, a cryptocurrency exchange, went public. Institutional interest drove its price further upward, and Bitcoin reached a high of $63,558 on April 12, 2021.

By the summer of 2021, prices were down 50%, hitting $29,796 on July 19. September saw another bull run, with prices scraping $52,693, but a big decline took it to a close of $40,710 about two weeks later.

On November 10, 2021, Bitcoin again reached a high of $68,789 before closing at $64,995. In the middle of Dec. In 2021, Bitcoin fell to $46,164. The price began to fluctuate more as uncertainty over inflation and the emergence of a new variant of COVID-19, Omicron, continued to spook investors.

Between January and May 2022, Bitcoin’s price continued to decline steadily, with closing prices only reaching $47,445 at the end of March before falling further to $28,305 on May 11. It was the first time since July 2021 that Bitcoin closed below $30,000. On June 13, crypto prices fell. Bitcoin dropped below $23,000 for the first time since December 2020. Since the “crypto winter” began in November 2021, Bitcoin has fallen below $20,000 by the end of 2022.

Fortunes changed for Bitcoin in 2023, which saw a tremendous rise in the price of the cryptocurrency. Bitcoin started 2023 at a price of $16,605. It rose throughout 2023, ending the year at $42,265.

2024

In January 2024, the long battle for Bitcoin Spot ETFs came to an end after the SEC was forced by courts to review its denial of certain Bitcoin-related products. Some brokers overwhelmed the market and increased their holdings, while others, such as Grayscale’s Bitcoin Trust (GBTC), experienced significant outflows early on.

The outflow of certain funds slowed into March, which settled the market somewhat. The market-wide rebalancing was probably because there were suddenly more options for investors to choose from.

Bitcoin’s price climbed rapidly after the fund approvals – in late February and early March it breached $60,000 again, setting a high of $69,210 on March 6 and another high on March 8 of $70,184 .

What Affects the Price of Bitcoin?

Supply and demand

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

By design, only 21 million Bitcoins will ever be created. The closer Bitcoin gets to its limit, the higher its price should be (as long as other factors remain the same). This limit is intended to increase the value of Bitcoin over time as new coins become more scarce, which should increase demand.

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 being created. The next halving is expected in mid-April 2024. If events proceed the same way they have in the past, Bitcoin’s price will rise again; however, there is no guarantee that it will react the same.

Bitcoin’s price should continue to rise as long as it continues to grow in popularity and its supply cannot meet demand. However, if popularity declines and demand falls, there will be more supply than demand. Then Bitcoin’s price should drop unless it maintains its value for other reasons.

New Bitcoin Securities

Another factor that affects Bitcoin’s price is also related to supply and demand. Bitcoin has become a financial instrument used by investors and financial institutions to store value and generate returns. As a result, derivatives were created and traded by investors. This also affects Bitcoin’s price.

Speculation, investment product hype, irrational exuberance, and investor panic and fear can also be expected to affect Bitcoin’s price because demand will rise and fall with investor sentiment.

As witnessed after the SEC approved Spot Bitcoin ETFs, regulatory activity causes market participants to take action regarding that activity. As new Bitcoin bonds hit the market, Bitcoin’s price will adjust due to any changes in the supply of and demand for more products.

Cryptocurrency competition

Other cryptocurrencies can also affect Bitcoin’s price. There are several cryptocurrencies, and the number continues to grow as regulators, institutions and merchants address concerns and adopt them as acceptable forms of payment and currency.

Finally, if consumers and investors believe that other coins will be more valuable than Bitcoin, demand will fall and prices will fall with it. Or, demand will rise along with prices if sentiment and trade move in the opposite direction.

The Bottom Line

Bitcoin has seen its share of volatile prices. If recent events and prices are any indication, it will continue to show volatility as long as there are questions from investors and regulators about how to invest in it and how consumers and investors deal with it.

The comments, opinions and analyzes expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more information. As of the date this article was written, the author does not own cryptocurrency.