The goal of seamless conversion of cryptocurrency to fiat has been an essential mission of crypto from the very beginning, and one that has become much closer to a reality with the latest generation of crypto bridging apps.
This ultimate end step, one that is much closer than it has ever been before, is only possible because of so many brilliant financial and technological minds who have been bold enough to experiment, find the limitations and see how an ambitious idea works in the real world.
Sometimes it goes extremely well, and in other cases, the realities of the young cryptocurrency market did not match these goals. When people move fast, they often break something as well.
With that in mind, and on the cusp of the future not only of crypto but of business transactions, here are some of the more unique early stories of when cryptocurrency was adopted, when it worked well and when it worked less well.
Over a year after the launch of Bitcoin, the first ever modern cryptocurrency, the early and small crypto community were largely content with mining what would decades later be millions of pounds worth of Bitcoin and speculating on what the future opportunities would be.
Contemplating lofty financial topics can make anyone quite hungry, and with that in mind, Laszlo Hanyecz, a user on a Bitcoin forum, offered to pay someone 10,000 BTC for two pizzas to be delivered to him from a Papa John’s pizza restaurant in his native Florida.
At 2023 exchange rights, those pizzas were a steal at £338,339,404.60 in total, and at a price of £169,169,702.30 per pizza, these two flying saucer food delights were possibly the most expensive single items of food ever purchased, adjusted for inflation.
At the time however, 10,000 BTC was worth around £35, and so a 19-year-old student by the name of Jeremy Sturdivant took up the offer and would be part of the first ever Bitcoin transaction used to buy a physical good.
At the time, none of the payment systems we know today were around, so the process had Laszlo send Jeremy the Bitcoin, Jeremy paid for the pizza in United States Dollars and brought it to them manually.
The 22nd May has since become known as Bitcoin Pizza Day, precisely because this proved that a decentralised financial system was possible, and in the wake of a brutal financial crisis that saw the failure of the then-established financial system.
Another way was possible, although it would turn out to take a bit longer for it to come to pass.
Driving In My Bitcoin Car
Amongst cryptocurrency enthusiasts, there are certain types of desired purchases that have become so commonly desired that they have become practically a rite of passage for successful investors, and one of these is a Lamborghini.
However, whilst the Lambo brand has always been associated with ostentatious displays of wealth, there are other reasons why it is so connected to crypto.
Lamborghini was one of the first car dealerships to adopt crypto, in part because of the volatility and high transaction fees that were common at the time that “when lambo” was a common question matter far less with expensive purchases.
This trend began with an anonymous user on an imageboard, who sold 216 BTC to buy a Lamborghini Gallardo.
Peter Saddington, the co-founder of VinWiki, entrepreneur and crypto evangelist, subsequently sold 45 BTC for around $200,000 in 2015, enough to buy a Lamborghini Huracan.
Power To The Players
By the mid-2010s, powered by systems such as BitPay, a lot of companies would experiment with allowing purchases through Bitcoin with perhaps the most infamous being KFC’s Bitcoin Bucket limited-time deal in 2018.
Publicity stunts and bizarre marketing moves aside, there were many attempts to legitimately use cryptocurrencies as the type of currency one would use for everyday items, but whilst it would work in some cases, it proved to be a learning experience in others.
The tragedy of Steam’s use of Bitcoin is a very telling case in point and illustrates a lot of the reasons why it made modern payment systems and infrastructure so necessary.
Steam, one of the most popular online video game marketplaces in the world, adopted Bitcoin as a payment method for a few months in 2017, catching the crest of a boom in the price.
This rampant volatility became exceptionally counterproductive when setting prices, and Steam’s parent company Valve would note that prices would fluctuate so quickly and with such high transaction fees that would compound if a customer needed to pay the difference each time, that they could not keep accepting crypto.
It shows the importance of balancing the ambition of DeFi with the needs of customers.