01 Post-earthquake prologue
In June 2008, in a makeshift tent in Wenchuan County, several stock investors were staring intently at the stock trends on their computers.
Even if they have just experienced a major disaster, they never forget to take a look at the stock market.
That year, the collapsed ruins after the earthquake seemed like a true reflection of the stock market.
The subprime mortgage crisis that originated in the United States quickly swept across the global financial markets, and tens of millions of investors were buried in the ruins of the stock market collapse. There is no greater sorrow than the loss of heart.
The epicenter of the earthquake was Wall Street in the United States, where five major investment banks withdrew from the market.
Lehman Brothers, a 158-year-old veteran investment bank in the financial market, still could not escape the backlash brought by the high-leverage game and declared bankruptcy in September of the same year.
Two months after the collapse of Lehman Brothers, a person claiming to be Satoshi Nakamoto published a long article on the P2P Foundation website.
The article challenges banks and traditional currencies, and at the same time brings about a "free and democratic" cryptocurrency that builds account security on cryptography.
The currency was called Bitcoin, and it was not issued by any one party but mined by supercomputers. The door to the world of blockchain was thus opened.
In January of the following year, Satoshi Nakamoto named the first batch of Bitcoin blocks "Genesis Block" and left a message: It was the time when the British Chancellor of the Exchequer stepped in for the second time to alleviate the banking crisis.
This sentence was the headline of the front-page article of the Times that day, full of provocation to the legal currency system at the time.
From the release of the Bitcoin white paper to the birth of the Genesis block, the global financial system was in dire straits. Satoshi Nakamoto was like a geek knight walking out of an ideal country, and he kicked off the monetary revolution.
However, the controversial Bitcoin has not brought any impact on the legal currency system, but has instead fermented its other attribute: a tool for wealth.
02 Geek Believer
One evening in May 2010, a starving foreign programmer exchanged 10,000 bitcoins for two pizzas worth about $30 in total.
Bitcoin first became valuable, and this day was called Bitcoin Pizza Day. At the time, 1 Bitcoin was worth only $0.003. Today, this is undoubtedly the most expensive pizza in history.
Geeks who often hang out in international forums have a new topic of discussion: Bitcoin.
One of them was Zhang Nangeng, who was studying for a master's degree at Beihang University at the time.
Zhang Nangeng studied integrated circuit design. Before he came into contact with Bitcoin, he was a nerd who liked to watch anime to pass the time.
In 2011, he became famous in the circle for making some FPGA machines specifically for mining Bitcoin, and was nicknamed "Pumpkin Zhang".
This year, science fiction writer Liu Zhipeng and Peking University Finance Department student Wu Jihan established the country's earliest Bitcoin forum and information website, Babbitt.
The first Bitcoin exchange in China, Bitcoin China, appeared, and people began to discuss how to mine coins in the forum.
In the summer of 2012, news broke that American institutions were developing integrated circuit (ASIC) mining machines with computing power far exceeding the level at the time.
A competition for the development of mining machines was launched. Zhang Nangeng dropped out of school and founded Canaan Creative, and successfully built the world's first ASIC Bitcoin mining machine "Avalon".
At that time, another legendary figure in the cryptocurrency circle, Kaomao, launched a crowdfunding plan to build machines on the official Bitcoin forum.
FriedCat's real name is Jiang Xinyu, a true genius boy. He entered the junior class of the University of Science and Technology of China at the age of 15, and later went to Yale University for further studies and pursued a doctorate in computer science.
Friedcat is an anarchist. When he first heard about Bitcoin, he was attracted by its freedom. He then returned to China to build mining machines before completing his PhD.
FriedCat became the second person to create an ASIC mining machine after Zhang Nangeng. He used crowdfunding funds to open a mining farm in Shenzhen and used his own mining machines to mine coins, earning 200 million in three months.
At the end of 2012, Wu Jihan wrote on Weibo: Welcome to the Bitcoin network. This is the financial free port, duty-free trade zone and anarchist paradise on the Internet.
03 Cryptocurrency Craze
With the two geek believers leading the charge, a large number of gold diggers have flooded into the Chinese Bitcoin world.
Since 2013, a group of people who are most enthusiastic about mining and trading Bitcoin in the world have emerged in China, and more than 70% of mines and transactions take place in China.
The "Chinese aunties", the country's unique number one player group, have turned their attention to Bitcoin after frantically hoarding gold.
It is said that the participation of Chinese aunts at that time helped the price of Bitcoin soar nearly 90 times.
Where there are gold diggers, there are naturally water sellers.
This year, the price of Pumpkin Zhang's Avalon mining machine was as high as 400,000 yuan, and it was hard to get one; Kaomao's mining business was making a lot of money and was in full swing; Tsinghua and Peking University talented students Wu Jihan and Zhan Ketuan founded Bitmain and started trading mining machines.
Several veteran entrepreneurs have come to the cryptocurrency market.
Li Lin, the former founder of group buying navigation website Renrenzhe, founded Huobi.com; Xu Mingxing, who failed in his entrepreneurial career, left Docin and founded OKCoin, the predecessor of OKEx.
The following year, He Yi, the beautiful host of Travel Channel, and Zhao Changpeng, a futures researcher at Bloomberg, joined OKCoin, forming the famous iron triangle in the cryptocurrency circle.
But the iron triangle was not solid and lasted only a year. He Yi and Zhao Changpeng left one after another and later founded the Binance exchange, turning He Yi and Xu Mingxing from boss to enemy.
The surge in Bitcoin prices in 2013 was as strong as it is today. After breaking through the 4,000 yuan mark, it approached 7,000 yuan within a few days, while it was only around 80 yuan at the beginning of the year.
Bitcoin has created a large number of wealthy people. Li Xiaolai, who was an English teacher at New Oriental in his early years, is the most typical one.
He bought 100,000 bitcoins in 2011 and called himself China's "richest bitcoin man." He not only founded the Bit Fund, but also established Yunbi.com and started a bitcoin exchange business.
This year was a carnival for China's entire virtual currency market. Along with Bitcoin, there was also a trend for game coins, such as World of Warcraft coins and Shanda points; and special coins for in-app purchases of portal websites and service software, such as Q coins, Pao coins, and Baidu coins.
However, behind the Bitcoin wealth-making carnival lies a market that is volatile, with some people becoming rich overnight while others naturally lose everything.
In mid-2013, the first overseas Bitcoin futures exchange, 796 Exchange, emerged. Futures-style trading rules allowed short selling, and the high leverage method attracted many domestic currency exchanges to follow suit, setting off a new round of carnival.
There was a prediction in the market: Currently one Bitcoin is equivalent to an iPhone, and in the future it will increase to the size of a house.
Today, many years later, the prophecy has almost come true, but the person who said this may have already been blown up in the thrilling leverage game.
04 Cold front passing
In 2014, FC’s mine was facing an unprecedented crisis.
The mining machine market has evolved into a battlefield for technological competition, with a large number of new competitors emerging, such as Bitmain's Antminer, which is gaining momentum.
At this time, the third-generation mining chip developed by FriedCat had an explosion problem that was difficult to repair, resulting in 14,000 mining chips being unsold. FriedCat quickly fell from its dominant position to the altar.
In January 2015, FC said he was going to inspect a mine, and then he disappeared completely, and his whereabouts remain a mystery to this day.
After the disappearance of FriedCat, competition in the mining machine market became increasingly fierce. Affected by the "Notice on Preventing Bitcoin Risks" issued by the Central Bank at the end of 2013 and the tulip bubble rhetoric, the price of Bitcoin continued to be sluggish.
When high electricity bills exceeded the price of the currency, more and more gold diggers turned off their computers, and mining owners began looking for places with cheaper electricity bills, such as Ordos, Inner Mongolia.
Mining machine manufacturers are facing the crisis of unsalable mining machines, and even Canaan Creative is no exception.
The era of getting rich by selling water has ended with the sluggish trend of Bitcoin, and the currency exchange is on the eve of a cold front.
In September 2017, when Li Xiaolai was on his way to the Beijing Financial Bureau, he already knew the reason for the meeting.
In the past few years, the Yunbi.com he founded has been making great strides relying on ETH (Ethereum). After Yunbi went online, the number of customers and transaction volume have been refreshed every day.
However, in the same month that Li Xiaolai was summoned for a talk, the People’s Bank of China and seven other departments jointly issued the “Announcement on Preventing the Risks of Token Issuance and Financing.”
It is clearly stated that no organization or individual may engage in illegal token issuance and financing activities, and all types of token issuance and financing activities should be stopped immediately.
Two weeks after the notice was issued, Yunbi.com permanently closed all trading functions. Binance went global, and Huobi and OKEx announced the suspension of registration and recharge.
For a time, the currency exchange market was like a cold front passing through, a large number of Bitcoin trading platforms were cleared out, and the earliest and largest Bitcoin China also closed its trading doors.
This year, under high regulatory pressure, Bitcoin's popularity in the Chinese market has gradually faded.
But in the global market, magical shocks are once again taking place.
The price was like a roller coaster ride, with the lowest point being $789 and the highest point being $18,674, an increase of 1,700%.
05 Wealth Props
Many self-media people who have experience in blockchain are still haunted by the major ban in 2018.
After the domestic token issuance was officially halted, the Internet Finance Association issued another reminder, saying that some investors have turned to overseas to carry out related activities.
At that time, blockchain self-media became popular overnight.
According to Jiemian, from February 1 to March 6, 2018, within 34 days, eight professional blockchain media received financing.
Blockchain editor recruitment positions are in short supply. According to a self-media person who once worked in the blockchain industry, he usually goes to meetings and drinks tea all over the country, and his monthly salary easily exceeds 10,000 yuan.
Behind the hype about the blockchain concept, however, lies a group of speculators’ “gray transactions”.
Industry insiders said that during the bull market, the price of a soft article in the leading blockchain media was around 50,000 to 100,000 yuan. The content of the soft article was actually an ICO (token issuance) project disguised as a blockchain.
Packaging ICO projects, operating communities, matching transactions, and investing on behalf of others are the wealth codes of these speculators.
On August 21, 2018, several blockchain self-media accounts were blocked overnight, and the teams were disbanded, leaving newcomers in the industry at a loss.
Two years later, these people who had experienced the undercurrent of capital once again witnessed the crazy magic brought by Bitcoin.
Within a week, there were two sharp rises and falls, hundreds of thousands of people’s positions were liquidated, and tens of billions of funds were wiped out.
The development of Bitcoin has long deviated from Satoshi Nakamoto's original intention. It has failed to become a creed to avoid tragedies, but instead has become a wealth prop that creates tragedies.
What most people are most concerned about today is how much Bitcoin has fallen, rather than what changes its electronic cash system will bring to the future.
Those Bitcoin believers and evangelists back then have now become bosses of listed companies, run cryptocurrency exchanges, or started new businesses with their first pot of gold.
These people initially entered the industry because of their fascination with technology, but now they may be more concerned about stock prices, market capitalization and performance.
After ten years of ups and downs, China's cryptocurrency circle seems to have never changed.