From Satoshi to Smart Contracts: A Visualization of Crypto Hot Topics
A visualization of popular keywords from Bitcoin and blockchain-related events on the site Meetup.com, shown above, gives you a sense of how crypto communities have evolved over the past 8 years.
The chart also highlights how crypto investing first gained popularity as a direct consequence of the 2008 financial crisis. In the years that followed, early Bitcoiners, many of them burned by the recession, began looking at cryptocurrency as an alternative form of investment.
In 2010, for instance, some of the most popular keywords for Bitcoin-related meetups include “Kendall” and “Forex.” That refers to the Miami-Kendall Forex and Bitcoin Trading Club, which was set up by Mike Torres in Miami (Kendall is a city district).
In the group’s description, Mike wrote that losses from trading traditional securities and derivatives in 2008 were the key reason behind his decision to explore alternative investing instruments (entrance fees to events can cost participants up to almost US $500). “I knew I had to get educated more and also get connected to the right people who knew more than me,” added the prescient financier.
Bitcoin languished at a price of about 6 cents for the entirety of 2010, peaking at around 30 cents by the end of the year. It was only in 2011 when the price started to see a consistent uptick; it briefly hit a high of almost US $30 in June but settled at around US $4 by the end of 2011. The figures still represented massive gains for early investors in the cryptocurrency, and the price volatility was a sign of things to come. It’s the same year people started to coalesce around a common interest of understanding Bitcoin. That’s partly why "Bitcoin" creeps into the visualization for the first time in 2011 along with keywords like "conference" and "lunch club."
The mention of 4x in 2011 is a likely reference to Litecoin, another digital currency that went live in 2011. The site Bitcoin4X redirects to the Litecoin page. The cryptocurrency itself is built on a stack which allows for quadruple the amount of overall currency in circulation as compared to Bitcoin. This also makes it four times faster in terms of transaction processing speed.
Bitcoin, as evidenced by the graphic above, rises dramatically from 2011 onwards. It was the same year that popular Bitcoin exchange Mt. Gox, which lost a catastrophic US $460 million in a hack before collapsing, was acquired by a French investor; and while the price of Bitcoin hovered around the US $700 mark until the end of 2013, it was clear that the medium of exchange had slowly found its way outside a niche community of enthusiasts.
People were now trading Bitcoin and taking it seriously as an investment vehicle. The world’s first Bitcoin ATM opened in Canada in 2013, too. The term "cryptocurrency" appears in the visualization for the first time in 2013 but the standout term for that year is evidently Bitcoin itself.
But it’s misleading to suggest that all this hype had positive connotations. Bitcoin was slowly starting to develop a bad reputation. It was the currency of choice on the Silk Road - the notorious marketplace tucked away inside the Dark Web.
That led to intense media interest in uncovering the founder of Bitcoin. Known simply by their online handle, Satoshi Nakamoto, the elusive founder attracted futile raids from law enforcement agencies and other desperate attempts to identify them. In 2014, the term "Satoshi" appears in the visualization for the first time. Of course, the keyword “Satoshi” for meetups could also refer to the cryptocurrency unit, which is named after the founder. A satoshi is the smallest fraction of Bitcoin that can be sent, or 0.00000001 BTC.
The vague term "buttonwood" is noticeable on the visualization in 2014, too. This is apparently a reference to physical locations where people could meet up in order to trade Bitcoin. In the US, there were buttonwood meetups in Los Angeles, New York, and San Francisco.
2015 witnessed the launch of Ethereum -- one of the most well known applications of the blockchain ledger after Bitcoin -- which probably explains why we see terms like "Bitcoin," "Blockchain," and "Ethereum" figure prominently that year. In December, CNBC trumpeted the fact that Bitcoin outperformed the US dollar. Global VC investment in Bitcoin-related businesses also surpassed the US$1 billion mark for the first time.
2016 and 2017 have denser keyword listings, which goes to show how understanding of the technology was starting to proliferate from a mere buzzword to more practical applications and solutions. The fintech startup Ripple, for example which uses blockchain tech to settle financial transactions between banks, payment providers, and corporates, raised US $55 million in 2016.
2017 is also when initial coin offerings, where organizations issue and crowdsell their own crypto tokens, took off -- even surpassing the amount of venture capital raised by internet companies that year. Rising interest and awareness around "smart contracts,” or software applications that run on blockchain technology, also began to enter mainstream consciousness, boosting the need for related meetups and events to exchange ideas, network, and educate.
It’s probably too early to predict the most popular terms for 2018 and beyond. Interest in Bitcoin has tempered slightly given its rapid price crash. But blockchain itself continues to stay highly relevant along with initial coin offerings and smart contracts -- as evidenced by the visual for the first four months of this year. Consulting firm McKinsey says the conversation around blockchain will move away from just share price volatility to practical applications: How can it be used to improve financial systems? Can migrant workers use it to send money back home quickly and efficiently? We already have examples of blockchain being used to help refugees.The United Nations World Food Programme (WFP) leverages the tech to track and verify identities of inhabitants in a Syrian refugee camp, as well as how much aid they’re allotted.
As more case studies emerge, we’ll see more conversations about real-world applications of blockchain. But the blockchain industry is evolving at a rate that makes it impossible to predict its eventual destination.
Osman Husain is a journalist based in Islamabad.