Whether discussing cryptocurrencies, stocks, or commodities, every market has its origins. Today, we’ll explore the history of the first cryptocurrency exchange, its creation, and its significance.
When most people think of the first cryptocurrency exchange, they often recall Mt. Gox. However, it was actually Bitcoinmarket.com that holds this distinction. The initial concept for the site was introduced on the Bitcointalk forum, the oldest Bitcoin forum where Satoshi Nakamoto himself used to post (his old posts are still accessible).
On January 15, 2010, a member named “dwdollar” made the first announcement about his upcoming exchange, which you can see in the screenshot below alongside a link to the forum. Two months later, Bitcoinmarket became the first cryptocurrency exchange to launch, going live on March 17, 2010.
Before dwdollar’s exchange, there was no consensus on Bitcoin’s value. However, upon Bitcoinmarket’s launch, Bitcoin was priced at approximately $0.003. At that time, you needed 333 Bitcoins to purchase a single dollar, while today, one Bitcoin costs around $27,653.59!
The initial method for exchanging USD for BTC was through PayPal. However, by the summer of 2011, PayPal lost popularity due to a rising number of scams, prompting many traders to seek alternative ways to buy Bitcoins.
This shift led to the rise of various exchanges and the introduction of crypto payment gateway, which provided a more secure method for transactions. Around this time, several exchanges emerged, including the one that would dominate Bitcoin transactions and later fall victim to the largest theft in Bitcoin history: Mt. Gox.
The Largest Exchange of the Early Days
At its peak, Mt. Gox controlled 70% to 80% of Bitcoin’s trading volume, making it the dominant exchange. Sadly, in 2014, the crypto community faced turmoil when it was revealed that Mt. Gox had been repeatedly hacked since late 2011. A hacker managed to access the exchange’s wallets, stealing funds in 90% of the cases as soon as they were deposited.
Ultimately, it was reported that an astounding 850,000 BTC had been stolen, representing 7% of Bitcoin’s total supply. To make matters worse, the CEO was aware of the theft for eight months before going public. The exchange eventually filed for bankruptcy, and its CEO paid a year in jail in Japan.
The Largest Exchange Today
Today, the largest cryptocurrency exchange by reported volume, according to CoinMarketCap, is Binance. Founded in China in July 2017 by the visionary entrepreneur Changpeng Zhao, Binance rapidly rose to prominence in the cryptocurrency space due to its unwavering commitment to customer satisfaction and innovative trading features.
Shortly after its launch, the Chinese government made a significant move by shutting down all cryptocurrency exchanges, requiring that ICO exchanges return funds to investors. In a remarkable show of integrity and customer care, Binance went above and beyond regulatory requirements by refunding investors their original investment amounts, ensuring that their trust in the platform remained intact.
However, Binance’s journey wasn’t without challenges. In May 2019, the platform experienced a significant safety breach, resulting in the failure of approximately $40 million worth of Bitcoin. During this trying time, Zhao exhibited remarkable transparency and leadership, keeping the community informed about the incident and the steps being taken to address it.
He assured users that they would be reimbursed from the company’s funds, a promise that further solidified Binance’s reputation as a trustworthy platform in a volatile industry. This commitment to customer care continues to define Binance as a director in the cryptocurrency exchange market.
Cryptohopper’s Journey
At Cryptohopper, our journey began in September 2017 with the launch of our very first trading bot, Cryptohopper, alongside our initial partnership with the Poloniex exchange. This marked the start of a commitment to empowering traders with innovative tools and resources.
As we evolved, so did our platform; by March 2020, we proudly expanded our offerings to include 18 exchanges, with plans for even more partnerships in the pipeline. Our goal is to provide users with the flexibility to connect with their favorite exchanges seamlessly. Whether you’re a seasoned retailer or just starting out, join us today and embark on your trading adventure with Cryptohopper!
