Two Cents’ Worth: Crypto’s post-bubble potential

Podcast: Two Cents’ Worth

Have you heard the story of the $75 million pizza?

It’s nearly 10 years since Laszlo Hanyecz of Jacksonville, Florida, posted in a web forum offering to sell 10,000 Bitcoins in exchange for two pizzas.

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Hanyecz was an early adopter of Bitcoin, the first cryptocurrency, which was launched the previous year by the anonymous figure or group of people known as Satoshi Nakamoto. Many in the tech industry saw the great early potential of Bitcoin to become a secure way to transfer digital currency globally, free of banks and their high fees and completely anonymously.

Last week, the price of a single Bitcoin floated around the NZ$15,000 mark. But on May 22, 2010, when Hanyecz posted his plea for pizza,10,000 Bitcoins were worth just US$40. A student, Jeremy Sturdivant, took him up on his offer, accepting the Bitcoin and placing an order at a Papa John’s pizza outlet for Hanyecz.

It likely went down as the first real-world purchase funded by Bitcoin. But those 10,000 Bitcoins are now worth around $150 million. Hanyecz remains philosophical about offloading his coins to Sturdivant, who in turn sold them for $400, making a tidy tenfold increase on his investment.

“People ask me ‘why didn’t you keep that Bitcoin?’ Well, you know, somebody had to start it off,” he told CBS News in November.

Hindsight is a great thing. For every Bitcoin investor made an overnight millionaire thanks to the surging price of the leading cryptocurrency, many more will have lost money selling at the wrong time during Bitcoin’s rollercoaster history.

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