Bitcoin and the Crystal Ball
Hilarious Side Stories to Teslas bitcoin transaction
The Adam of all cryptocurrencies was invented more than a decade ago. Since the start of the internet and Jeff Bezos's glorious idea to start Amazon.com — lucky for us, not as Cadabra, which sounds like Cadaver — payment was a huge issue, especially fraud.
In the 1950s, credit cards were invented to solve the problem of carrying money bags with you. The first one was the Diners Card, which I still am a customer of today.
I remember the days when credit cards were used together with these funny mechanical machines:
The Credit Card Imprinter
It allowed the merchant to copy the credit card information quickly on paper and hand a copy to the customer to countersign it. Its most recognizable characteristic was this swish pop sound.
Before the invention of this funny machine completing the payment process was handwritten paperwork, which just was a long process. I remember customers waiting in the line complaining, “Oh no, another one with a credit card. Now we have to wait much, much longer.”
And it was true, the merchant had to get the papers out, write everything down in a readable format, check the identity of the customer and the signature, and this was time-consuming.
Payment with cash compared to that was a quick and easy process—so much room for improvement for smart entrepreneurs.
And the funniest thing was that the entire relevant payment and security information was written on the credit card slip.
How Secure was Payment in the Early Online Days?
Payment Security online was an issue since the first day of the internet.
Why?
The payment slips alone were not accepted as proof of credit cards in real-life transactions.
I needed to show the physical credit card and sign the slip to authorize the transaction in real life. The salesperson then compared my signature with the signature I had on the back of my credit card and, when in doubt, also asked for proof of identity.
A complex process and the steps could not be copied quickly in the first days of the internet. However, using a credit card in an online transaction was simple:
Just enter the credit card number and expiration date — and the transaction was authorized.
The rest of the security process wasn’t really designed for the internet age.
And the funny thing:
All this necessary transactional information was printed in full detail on all credit card slips, which the customer Average Joe usually threw into the trash can after filling up the tank at the gas station.
Fraudsters just needed to get the slips from the bin and have fun online shopping.
Satoshi Designed the Real Game-Changer
Since then, a lot of work was done to make online transactions safe, but every idea was tied to the old thinking of a process that involves many corporates to verify the payer's authenticity.
The blockchain aims to solve this problem as it automates this critical process. As a side effect, tokens are issued that can also be used for payments.
I didn’t take this new system seriously for years. The code is easy to copy, new tokens can be issued, and besides the technology, why should a token have any serious value?
Blockchain technology is great, and I believe in its value, but I was never a believer in the token value called bitcoin for investment purposes.
History proved me wrong quite quickly.
Today
one bitcoin is worth more than 50,000 dollars.
Funny Side Story Number 1 — Pizza Gate
The first commercial transaction took place May 22, 2010, and was done by Laszlo Hanyecz, a developer.
He bought two pizzas for the price of 10,000 bitcoin, which had a value of 45 dollars back in the days.
2010 a lovely year — two years after the big stock market crash and also two years after the person or group Satoshi published the white paper
Bitcoin: A Peer-to-Peer Electronic Cash System.
I think about selling the two pizzas for 10,000 bitcoin and just holding the coins till today.
It would be worth
500,000,000 dollars
Enough money to retire early and enjoy life.
Well, unfortunately, I neglected bitcoin until 2017 and got in almost at the highest point. Of course, I sold close to the deepest point in 2018—the number 1 newbie mistake.
Side Story Number 2
Tesla bought 1,5 Billion — not Bitcoins — they deployed 1,5 billion dollars into bitcoin in December 2020.
A large amount as it is about 8% of Teslas Cash position and Elon Musks tweet
In retrospect, it was inevitable
will definitely become legendary over the coming years.
The funny story around that is something else. At the end of 2020 — when Tesla really purchased bitcoin — a Reddit user with the name u/TSLAinsider wrote the following.
The announcement of Tesla in its annual report for the fiscal year 2020 was made public on February 8, and Elon Musks' tweet happened on January 29.
In retrospect, in a listed company, usually, information for such transactions doesn't get leaked publicly.
But there were these Reddit messages in December 2020, coincidently by the time I assume Tesla really was buying bitcoins.
Oh, this is not a funny story?
Well, the fun in it is — this post was a hoax.
Actually, this particular Reddit User said he was high on LSD when he posted on Reddit, and he never was or is an employee at Tesla.
A few days ago, the same user posted and declared that he is a German dude who did this just for fun — high on LSD.
I believe this is a hilarious moment in the bitcoin story so far, a token that, in reality doesn’t do anything. It is like Warren Buffett said,
…worthless delusion and ‘rat poison squared. Cryptocurrencies basically have no value and they don’t produce anything…
And yet to date, there are people in the world who pay 47,000 dollars for one coin and a company named Tesla who deployed 1,5 billion into bitcoin.
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Since 1999 I am an executive, advisor, and coach for companies in various industries. I am specialized in Corporate Development and Finance, from seed rounds to IPO level, and focused on life science since 2006.
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This article is for informational purposes only. It should not be considered Financial or Legal Advice. Consult a financial professional before making any significant financial decisions.