Bitcoin turned 10 last year. Time sure does fly, doesn’t it?
It seems just like yesterday that the shadowy Satoshi Nakamoto birthed the first cryptocurrency as a means to provide a virtual, verifiable, and decentralized marketplace. And just like any upstart youth, Bitcoin has experienced its fair share of growing pains, especially when it comes to crypto PR.
Bitcoin certainly wasn’t built in a day. I still remember explaining it to my dad, struggling to grasp core concepts like blockchain and cryptocurrency. Likewise, I distinctly recall the time when one of my seedier friends explained the Silk Road to me and, as a result, I would always associate it with Bitcoin.
Then of course the Bitcoin explosion happened when everyone and their mother seemed to be talking about crypto this and crypto that (including the truly ridiculous cryptokitties). But as the old saying goes: the higher one climbs, the harder they fall. Since it’s historic 2017, values have plummeted.
The volatility of Bitcoin has been second to none, with historic highs followed by historic lows. And there’s of course been a huge amount written about it in the media, both good and bad. So what can the history of Bitcoin show us about the importance of PR?
Crypto-what? The importance of a good white paper
My dad wasn’t the only one who failed to grasp the ins and outs of this new virtual currency (confession: myself included). Blockchain may be the trendy tech of today but at the time it was a much more nebulous concept. And what on earth is bitcoin mining?
For those who are developing innovative products that are difficult to understand, articulating your mission and vision is vital. This is where the white paper comes in. For startups and growing businesses, a well written white paper could be the difference in securing funding or not. Furthermore, for something as unique as Bitcoin, white papers can help develop a niche authority on the subject.
Fortunately, Nakamoto knew the importance of early publicity and released the Bitcoin white papers on October 31, 2008 – a full two months before the creation of the first block of the “Genesis Block”.
It’s hard to stress the importance of a good white paper when creating buzz for a product like Bitcoin. When it began to pick up steam, the handy white paper made it easy – well, easier – to decipher how it actually worked.
Cultivating positive PR with the world’s most expensive pizza
Good PR can take the form of a charming story about the founding of your company. Stories like these can show that the people that work at your company are relatable, intelligent, and hard-working. Likability in the public’s eye can be crucial to getting them to buy into something that they perhaps don’t completely understand.
Without the luxury of a high profile, suave CEO, Bitcoin didn’t have the luxury of appealing to the public in this manner. However, there is a rather comical story about the first official sale using Bitcoin.
May 22nd is the annual Bitcoin Pizza Day, where we commemorate Laszlo Hanyecz’s historic purchase of two Papa John’s pizzas – for a whopping 10,000 coins! Remarkably, this marked the first recorded purchase of an item using the currency.
Don’t worry I did the math: By today’s conversions, that translates to $50,000,000 and, at the crypto peak in 2017, $200,000,000! But don’t feel too sorry for Laszlo. Bear in mind that as someone who invested so early, he almost certainly didn’t spend it all on two pizzas.
Bitcoin has certainly seen its fair share of scandals. The Silk Road played the role of thorn in the side of its public image for many years. This would lead to the Silk Road playing its final trump card of bad bitcoin PR during its closure in 2013, with the FBI seizing 26,000 Bitcoins.
The Mt. Gox scandal further affected Bitcoin’s PR, lowering the credibility of cryptocurrencies everywhere. This came as a shock, as blockchain technology is meant to ensure security. In fact, the ripples of this story are still being felt to this day, with full understanding of the actual events remaining unclear.
But as Bitcoin would prove, bad press isn’t a death sentence, as the most fruitful days were yet to come.
Moving into mainstream
At the end of 2014 Microsoft began to accept Bitcoin as a form of payment when customers purchased games and apps. It also started to make the front pages of major publications, even appearing on the cover of The Economist in late 2015. Appearances in these mainstream publications were a clear precursor to its imminent peak in popularity. Then of course, in 2017, its value began to skyrocket, just as its media coverage peaked.
The Cryptobubble and the Great Crypto Crash of 2018
Perhaps the most well known quality of Bitcoin and cryptocurrencies in general is their extreme volatility. In 2011, Bitcoin finally became equal with the dollar, rose to 31:1 and then fell to 10:1 just four days later. This of course was just a precursor to February 2018, where its value fell by 65% in just one month.
But the thing is, we predicted this would happen. A true dream team of economists (EIGHT Nobel laureates) predicted a bursting of this bubble. But the public, riding the wave of Bitcoin’s popularity in the press, continued to drive the price of cryptocurrencies up until its massive fall at the end of 2017.
It truly has been a wild ride for Bitcoin and similarly for all cryptocurrencies. I for one am looking forward to continuing this journey; in another 10 years who knows where Bitcoin will end up and what further lessons it can teach us about PR.