Like most lifelong traditions recognized worldwide, it starts with one person’s achievements or actions. Bitcoin Pizza Day is no different from this. It marks the day when a transaction seemed so simple yet held remarkable significance in Bitcoin’s story until today.
Bitcoin Pizza Day marks the day Bitcoin was first used for the reason it was created. It proved that it could be used as a medium of exchange, which is one of the defining characteristics of money.
What are the characteristics of Money?
By definition, money is anything generally accepted as a medium of exchange for payments, settling debts, and fulfilling business obligations. Most fiat currencies in the world today are backed by government acceptance.
Ever since the discontinuation of the gold standard in 1971, when the dollar was no longer backed by gold, most fiat currencies in the world, including the U.S. dollar, have pretty much been backed by government acclaim, which then drives citizens and the public to accept it as money.
For any currency, item, or entity to be accepted as money, it must meet these standards:
- A medium of exchange.
- A common measure of value (or unit of account).
- A standard of value (or a standard of deferred payment), and
- A store of value.
Money as a medium of exchange
Before money, trading goods and services was a hassle. You had to find someone who wanted what you had and wanted something from you in return. It was a chance game. But money changed the game. It became the go-between in transactions, so you don’t have to worry about finding the right match. With money, both parties can agree on a fair value for what they’re exchanging.
Money as a unit of account
In economics, we need a way to measure things’ value. That’s where the money comes in. It acts as a common measure of value, like a yardstick for prices. It helps us know how much something is worth, from a simple item to something more expensive. Money also helps businesses keep track of their finances accurately.
Money as a standard of value
When it comes to debts and loans, trust is essential. Money plays a crucial role here too. It acts as a standard of value, ensuring people honor their commitments. If someone owes you money, they can pay you back with money because it’s widely accepted as a means of payment. It’s like a guarantee that promises will be kept.
Money is a store of value
We all like to save money for later, right? Money is an excellent way to store value. You can save it, keep it safe, and use it when you need it. However, it’s imperative that money’s value stay relatively stable over time. Some people worry that inflation, when prices rise, can lose money’s value in the long run. But overall, money is a handy tool for keeping our wealth safe.
What is Bitcoin Pizza Day?
The Bitcoin whitepaper was released in 2008, but the first Bitcoin blockchain transaction was recorded in 2009. Although a community of Bitcoin users had already been formed of people who believed in the vision of a decentralized currency that didn’t need permission from any third party or government and its potential to become one of the most groundbreaking innovations in finance globally,
It had not yet been used for any type of physical purchase. And to be considered money, it had to fulfill the functions that categorize anything as money. On May 22, 2010, a British man named Lazlo Hanyecz posted on bitcointalk.org, offering to purchase two packs of pizza in exchange for bitcoin as payment. This probably harmless post by Laszlo would turn out to be a turning point in Bitcoin history, which actually led to the rise in Bitcoin and blockchain technology adoption.
Although Laslo made the post, he didn’t get any response until May 22, 2010. This is when 19-year-old Jeremy Sturdivant accepted the offer of purchasing two packs of pizza for $41, delivered to Laslo, in exchange for 10,000 BTC. It is significant to note that then, 1 BTC was less than $0.01, but the point of the exchange was to prove that Bitcoin could fulfill the function of money as a medium of exchange and as a standard of value.
What does Bitcoin Pizza Day mean to the community now?
When the story of the first Bitcoin transaction is narrated, the first response is that it was a foolish decision. This is because 10,000 BTC are traded, and at the time of writing, 1 BTC is traded for $27,500, making it worth over $270,500,000.
Whether or not it was a wise decision is not so critical. The significance of the event is the most significant focus because the transaction proved that Bitcoin can be used as money because it fulfills the functions of money as stipulated for any commodity or item to be regarded as money.
Also, what is often overlooked is that Laszlo’s transaction on Bitcoin Pizza Day shows the importance and power of a community. It also shows what a community can achieve. Because without the community present, the transaction wouldn’t have been possible, and neither would Laszlo have gotten his pizza for 10,000 BTC.
Hence, in celebrating Bitcoin Pizza Day, not only does the crypto community celebrate the first commercial transaction using Bitcoin, but it also brings to mind the importance and power of community in Web 3.
Bitcoin Pizza Day is now celebrated globally to mark the importance of community. It is also to be united in the vision of a decentralized society and its potential.
In my hometown, also in Yenagoa, Nigeria, the Bitcoin Pizza Day event is organized to promote Bitcoin adoption among the citizens and also presents a time for crypto folks to come together and share their journeys in the blockchain space over pizza and drinks.
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