How bitcoin used to be mined back in 2009

The first cryptocurrency appeared 14 years ago. Bitcoin was created by an unknown developer under the pseudonym Satoshi Nakamoto. In January 2009, the first block (Genesis) of the blockchain was found. At that time, the coin was worth nothing. In July 2023 Bitcoin traded above $29 thousand. In the article we will tell you how BTC was mined in 2009.

The emergence of the blockchain

The history of the decentralized network began in the first half of the 1990s. Stuart Haber and Scott Stornett – cryptographers who proposed the idea of blockchain. The idea was to form a system in which the timestamps of documents could not be tampered with.

In 1992, the project was modernized with the Merkle tree. This is a hashing algorithm that verifies information in blocks and determines the integrity of files. The binary function encrypts the data for digital signatures.

In 2008, blockchain theory in practical application was described by an anonymous developer under the pseudonym Satoshi Nakamoto. In early 2009, he published the technical specifications of the Bitcoin distributed ledger, a peer-to-peer electronic payment system. The document described the principles of decentralization and anonymous transactions. At the same time, the genesis block of bitcoin was formed. The first price of the coin was set 9 months after the launch – 1309 BTC per dollar.

How bitcoin was mined in 2009 on processors

The first block of BTC was mined by Satoshi Nakamoto – the creator of the blockchain. It is established that in the process of mining, the developer found 750 BTC. At the same time, in 2009, early adherents of blockchain technology appeared.

Bitcoin was launched on the SHA-256 algorithm.

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Earlier, in 2009, bitcoin was mined on central processing units. According to Satoshi Nakamoto’s idea, users’ computers were supposed to ensure decentralization of the cryptocurrency. The first transaction in the network was performed on January 12, 2009 – the developer mined and transferred 10 BTC to Hal Finney. A total of 32 BTC were sent that day.

In 2009, Bitcoin mining did not require any special equipment. Any PC with simple software could do the job. The success of CPU mining depended on two technical capabilities of the CPU:

• Hashing speed. Determines the chances of solving the cryptographic puzzles required to get the mining reward. It is measured in kilo hashes per second (KH/s).
• Power Efficiency. This score helps miners compare the size of rewards and energy costs.

Bitcoin value in 2009

Technically, the value of BTC was $0. The cryptocurrency was not yet in demand. In October 2009, the New Library Standard website published a bitcoin exchange rate of $0.003. At that time, $1 was worth $1,303 BTC.

Buying and selling bitcoin

Cryptocurrency was not traded anywhere in 2009. BTC could be purchased on forums among a narrow circle of people interested in blockchain technology.

Earlier, in 2008, the domain bitcoin.org appeared. The site published offers to buy cryptocurrency. Before the emergence of exchanges, it was easier to mine bitcoin than to buy it for fiat.

The complexity of the network in 2009

At first, only IT-savvy people knew about cryptocurrency. Blockchain was talked about as a technology. However, the financial component was not seen in it. Due to the lack of popularity, the complexity of blockchain was minimal. BTC could be mined on the least powerful computer.

The reward for mining a block was equal to 50 BTC. It is known that Satoshi mined about 11 million coins in the first 7 months. At that time, there was no reporting on the complexity of the algorithm.

Further history of mining

Bitcoin mining was once a hobby for IT geeks. Gradually, it started to become profitable. Mining required almost no expenses. The only equipment a crypto miner had was a simple computer. The situation changed in less than 10 years.

In October 2010, the code for mining coins was opened to the general public. As the audience grew, the complexity of the blockchain increased, and with it, the need for more productive hardware. Only graphics cards could cope with the tasks of the algorithm.

Mining on a single graphics processor required few technical skills and means. Almost any user with a capital of $500-1000 could start mining. However, the trend quickly changed as the Bitcoin exchange rate began to rise.

Mining scaled after modifications to FPGAs – programmable gate arrays – were created. The new kind of hardware consumed three times less power than a GPU to perform the same amount of calculations.

Soon valve arrays gave way to application-specific integrated circuits (ASICs), and blockchain went from a hobby to an industry. Unlike FPGAs that require customization, asics are built for a specific use – cryptocurrency mining. Such tech remains the standard in 2023.

Frequent questions

📌 How many bitcoins could be mined in 2009?

The profit depended on the hash rate of the computer. On average, 2 thousand coins could be mined in a day.

📢 What is the record value of BTC?

The maximum price for all time was $67 thousand (November 12, 2021). This exceeds the initial quotes by a factor of 22 million.

✨ Why did Bitcoin become popular?

Cryptocurrency allows for anonymous and fast transactions from anywhere in the world. With the growing popularity of the digital asset, there are more people willing to make money on the differences in the coin’s exchange rates due to its high volatility.

🔔 Why Satoshi Nakamoto’s identity has not been revealed?

The cryptocurrency creator disappeared 12 years ago – on April 26, 2011. On that day, the developer wrote his last message to Gavin Andersen with important data about the workings of the blockchain. Since Satoshi used encrypted communication channels, his identity could not be established. There could be several reasons – the developer wished to remain anonymous, died or lost interest in the technology, forgot the keys to access the wallet.

🔥 How is mining done now?

In 2023, ASICs and video cards are used to mine cryptocurrencies. New and unpopular coins can still be mined on processors.

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Author: Saifedean Ammous, an expert in cryptocurrency economics.