Most people currently in the crypto trend happen to see Bitcoin as the first cryptocurrency created. However, this tends to be false information as they existed many other coins before BTC. Maybe they didn’t gain enough popularity, making them forgotten and inconsequential. Hence, we’ve come to disclose to you what the first crypto current is and how it came about.
Meanwhile, Bitcoin started gaining popularity around 2008 and busted later on. Still, many coins existed decades ago before its existence.
However, while Bitcoin outperforms those initial digital currencies, they did pave the way for Satoshi Nakamoto’s creation to become a reality.
If you are wondering who Satoshi Nakamoto then know that he is the person behind the creation of Bitcoin. Meanwhile, read further to learn about the first cryptocurrency created.
What Was The First Cryptocurrency Before Bitcoin?
Ensure to carefully read this background y to learn how the crypto sphere came about. In the year 1983, a popular American cryptographer named David Chaum proposed a form of electronic cash (eCash). He proposed a token currency that we could transfer between individuals safely and privately. Thus this token has great similarities to modern-day cryptocurrencies.
So, in this bid, Chaum established a so-called “blinding formula” they’d use to encrypt information passed/transferred between individuals. Later on, you could safely transfer “Blinded Cash” between individuals, bearing a signature of authenticity. While you can also modify it without traceability.
Several years later, in 1989, Chaum founded DigiCash to put his concept into practice. Now Digicash became the company behind the creation of the first know cryptographic electronic money called eCash.
DigiCash’s focus on “privacy” gained Chaum a lot of interest from investors and companies. Numerous banks indicated interest, while Microsoft even wanted to incorporate DigiCash into Windows 95.
Ultimately, the many DigiCash contracts all fell through. This happened because DigiCash was a private digital currency. While comparing to the open-source cryptocurrencies existing today. This means it DigiCash found it difficult to expand in the pre-Internet era.
However, in 1998 DigiCash went bankrupt. Meanwhile, the company put forward ideas, formulas, and encryption tools that played an important role in developing digital currencies later on.
Besides DigiCash (eCash), Hashcash also had an important influence on bitcoin. Developed by Adam Back in 1997, Hashcash used Proof-Of-Work (PoW) algorithms, also adopted in bitcoin for transactions.
Other Early Cryptocurrencies
In 1996, Dr. Douglas Jackson and Barry Downey developed electronic money tied to the ownership of gold. This digital currency enabled users to transfer ownership of gold between users of a website. However, this quickly though unintentionally became a tool for money launderers and others who don’t want to be caught in their illegal activities.
#2. Bit Gold
Nick Szabo, one of the early cryptocurrency pioneers, given credit for having developed the concepts that eventually led to the creation of Bitcoin, created Bit Gold. The concept was exercised by Bit Gold. It used many of the same blockchain methods, such as a peer-to-peer network, a ledger or registry, mining, and cryptography.
Developed in the mid-1990s, Hashcash became one of the successful pre-bitcoin digital currencies. They designed the coin for various purposes, including reducing email spam and avoiding DDoS attacks.
Meanwhilele, Hashcash had such an impact on bitcoin that even Satoshi Nakamoto cited it in the bitcoin white paper.
Furthermore, Hashcash used a proof-of-work (PoW) algorithm to enable the generation and distribution of new coins, much like many modern cryptocurrencies.
In 1998, developer “Wei Dai” proposed an unidentified, distributed electronic cash network called B-money. Dai proposed two different protocols, including one which needed a broadcast channel exhibiting both synchronous and unjammable qualities. Eventually, B-money was never successful. It differed from Bitcoin in several ways. Nevertheless, it was also a trial with an unspecified, private, and secure electronic cash system.
What Is The Oldest Cryptocurrency Exchange?
During the inception of Bitcoin, they didn’t exist exchanges to aid transactions and trading of cryptos. Rather most transactions happened via bitcoin-focused forums, such as Bitcointalk. Bitcointalk was also created by Satoshi Nakamoto.
However, later on bitcoinmarket.com became the first bitcoin exchange and the most popular method of trading after the forum. Bitcoinmarket.com went live in March 2010 after its proposal by ‘dwdollar’ on the Bitcointalk forum in January 2010.
Although many exchanges existed before Bitcoin Market, they did not focus on cryptocurrency transactions. They shifted to allowing crypto transactions when bitcoin gained popularity. For instance, the popular Mt.Gox (Magic the Gathering Online Exchange) was first founded in 2007 as an exchange for the trading card game. While it also switched to bitcoin trading in 2010.
Currently, both the Bitcoin Market and Mt.Gox no longer trade. Mt.Gox filed for bankruptcy in 2014 during a string of well-publicized violations that brought about over $450 million in bitcoin stolen/lost.
Nonetheless, among the existing and active exchanges, Bitstamp and Kraken take the place of the oldest cryptocurrency exchanges. Kraken launched on 28 July 2011, while Bitstamp came to be one month later. These both formed as substitutes to Mt.Gox, which had endured its infringement just a month earlier.
Frequently Asked Questions About What Was the First Cryptocurrency
When Did Crypto First Appear?
Crypto first appeared in the 1980s. That was the first known attempt to create a cryptocurrency called eCash. David Chaum wrote the first whitepaper and founded a company called DigiCash that eventually made eCash.
What Is the Oldest Crypto?
Bitcoin is not the first cryptocurrency as proved herein. However, Bitcoin is the oldest surviving one.
What Was the First Thing Bought With Crypto?
Pizzas were the first stuff bought with cryptocurrency in 2010. The user paid 10,000 BTC to purchase 2 Pizzas. The equivalent of that amount now in 2022 is about $222 million.
Finally, we’ve discovered that Cash was the first existing crypto asset. Although it didn’t gain market momentum it sure gave the crypto sphere good posterity.
Thus, if anyone ever tells you that Bitcoin is the first cryptocurrency, you should help them clear their doubts with this article.