Bitcoin’s early promoters relied initially on chat forums to build support, but found also some willing media support, mostly from digital culture blogs. Many of these early players also earned or bought bitcoin at very low prices and subsequently became millionaires or even billionaires when the price later rose into the thousands. Some of these early players will re-appear later in the bitcoin story as villains, undone by megalomania.
At the start of 2010, bitcoin didn’t even any exchanges where people could turn fiat into bitcoins. Untraded, with no price discovery, its value was under one US penny. In those early days, the easiest way to obtain bitcoin was by mining. It was easy enough to earn 10,000 bitcoin as a miner, and some of the people earning bitcoin simply gave some away to friends to encourage them to join the movement. In 2010, the developer Gavin Andresen set up a website called bitcoinfaucet.com and gave away 10,000 bitcoin. It wasn't until May of that year until someone finally spent some bitcoin, nearly 18 months after the first bitcoin had been mined by bitcoin’s anonymous creator Satoshi Nakamoto.
A software developer called Laszlo Hanyecz did some of the early mining of bitcoin, and in an early instance of price discovery, he posted online an offer to pay for a pizza with bitcoin. Hanyecz found someone willing to order him two pizzas: the seller wanted 10,000 bitcoin in exchange. Figuring that his bitcoin bounty at that time was worth about $0.003 or $0.004, about one-third of a US penny, Hanyecz guessed that the dollar price of the pizzas was the equivalent of $30 or $40, and he accepted the offer. Today, there are regular Twitter posts on the current dollar cost of the 10,000 bitcoin pizzas, which touched close to $200 million during December of 2017.
Word of mouth (or word of email) was proving an effective tool for hackers to spread the world about bitcoin. The hacker world was well connected with libertarians and anarcho-capitalist groups who would entertain proposals to disrupt the centralised money system. In early 2011, Gavin Andresen arranged to meet for lunch with Mark Edge, host of a radio show called Free Live Talk. (One story says that Andresen paid Edge for the lunch with 25 bitcoin, which Edge accepted through mybitcoin.com, the first US bitcoin exchange, which was promptly hacked, and went bankrupt, with Edge losing all of his payment.) Still, Edge was interested and talked about bitcoin on his radio show. A young businessman called Roger Ver, who was listening to the show, became a near-instant convert.
Ver would go on to invest in a handful of new bitcoin companies, starting with Charlie Schrem’s Bitinstant, and following with investments in exchanges Kraken and Bitpay, and blockchain businesses Ripple and blockchain.info. Ver’s money was important early financial support for the ecosystem.
Jon Matonis, who was running a digital currency blog in 2010, says he received an email from Satoshi Nakamoto about bitcoin, and became an early believer. In 2011, Matonis spoke to financial journalist Max Keiser, who urged his listeners to invest in bitcoin. (The price at that point was $3 a coin).
In September 2012, the early players looked to formalise the scattered culture. Roger Ver along with Mark Karpelès of Mt Gox, Charlie Schrem of Bitinstant, Gavin Andresen, lawyer Patrick Murck, Mehul Puri and CoinLab founder Peter Vessenes started the Bitcoin Foundation to promote the cryptocurrency. It was modelled after the Linux Foundation, and if the Bitcoin Foundation had laudable early goals, it subsequently suffered from the high profile of its founders: within a couple of years MtGox was bust and Charlie Schrem was in jail. Some people suggested that bitcoin needed more marketable leaders. The Winklevoss twins answered the call.
