On the day the season was born, the price of bitcoin had dropped more than 40%.
Today, “hodl” is part of bitcoiner philosophy.
You might think that a story of only 11 years has too many legends, mysteries and events to tell. Especially if we’re talking about creating a new kind of currency, it seems that bitcoin’s (BTC) existence time is not over yet.
However, its history is full of stories and myths that enrich the tale. And one of them, perhaps the most important, was born in the most unexpected way. A typo during a monologue written while drunk led to creation a term now fundamental to the bitcoiner environment: “Hodl”.
It happened one night in December 7 years ago, with a post on the Bitcointalk forum. The post’s creator, a holder of bitcoins at the time, was tasked with saying why he kept “hodling” (holding, holding office) his holding of BTC, despite a significant fall in the price of cryptocurrency.
That day, December 18, 2013, bitcoin fell more than 40% from the previous day. In just a matter of hours, the market value of the coin went from nearly $ 740 to $ 420, according to records from CoinMarketCap.
In his post, entitled “I’m hodling” (I’m holding out), user GameKyuubi explained that he had now written the famous title twice, knowing it was wrong. “It’s still wrong,” he added of the error.
With this post, the term “hodl” was born in Bitcoin. Source: Bitcointalk.
GameKyuubi claimed he held his positions in bitcoin because of his lack of skills as a trader. “Why am I holding on? I’ll tell you why. This is because I’m a bad trader and I know I’m a bad trader, ”he wrote.
In a messy post, full of typos and capitalist phrases mixed into the text, GameKyuubi claimed that good traders could easily take large profits while “weak hands” were sold in bear markets. “People in the middle are still,” argued the bitcoiner.
Later, that user reported that he tried to trade and sell his bitcoins through his mobile phone. The equipment started to fail, introducing a lot of slowdown, and it was impossible. “I went back to my room and started drinking,” he recalled during an interview with Coindesk.
Price drop as of December 18, 2013. Source: CoinMarketCap.
More than an investment strategy: Hodl as a philosophy
Almost immediately, and unknowingly, GameKyuubi initiated one of the principles that bitcoiners around the world profess. Not immediately becoming a feme, from the responses to the conversation on the Bitcointalk forum.
Hundreds of responses began to arrive at the publication, with memes comparing the “hodl” with the Spartans’ resistance in the movie “300”, or as the “teachings” of legendary acting actor Chuck Norris, to mention the former.
Also, forum members were repeating the term to the point where “hodl” surpassed the bitcoin discussion points, reached social networks and practically ended bitcoiner’s philosophical principle.
Along with slogans like “not your keys, not your bitcoin” (which refers to the self-holding of your coins) or “pile sats” (accumulating satoshis, minimum BTC unit), “Hodl” may be one of the expressions that you will see most bitcoiner usage. Especially if you’re talking about investment or bitcoin as a store of value.
Those last two ideas come together in bitcoiner philosophy, based on the need to get more and more bitcoin and never let it go, or do it alone in the long run. The term has come to the forefront of a fundamental idea for those who believe in cryptocurrency: Bitcoin’s value is out of sync and its price is still well below its fair share.
One of the first responses to the post. Source: Bitcointalk.org.
Bitcoin hodl in the long run
What started as a mistake or part of roaming in the midst of drunkenness, not just ending was an important part of bitcoiners attitude. Also, history has proven right during these 7 years.
Since the fall of that December 18, bitcoin has valued more than 5,000%, if we take into account the current price of the cryptocurrency in the market, around 23,000 dollars.
Before collapsing that day, bitcoin was for the first time above $ 1,000 just days before. So hitting $ 450 seemed like a desperate fall for bitcoin. Thereafter a bear market that took BTC to a bottom of just over $ 200 in 2015.
That trend was followed by a new bull market. In 2016, the $ 450 barrier was broken again, and since then bitcoin has never been below that price again.
The history of 2013 has repeated itself ever since. In 2017 the infamous bull run that took bitcoin for the first time came to around $ 20,000 in December and then came a new fall. But the lowest BTC after that was $ 3,500, in December 2018.
If we look at the historical graph, similar movements have occurred approximately every 4 years. For this reason, many believe there is a historic maximum cut this December followed by an even bigger boost in 2021.
Some analysts, like Willy Woo, even view BTC’s predictions at $ 100,000 as very conservative assumptions. In your case, see bitcoin at least above $ 200,000 next year.
To date, bitcoin price histories underpin the “hodl” philosophy. Source: CoinMarketCap.
Withdrawal plan in bitcoin
So far, the long-term bitcoin price trend only supports the “hodl” philosophy. So much so, that for many it is the best retirement plan for their later years.
Stories about early-stage investors who are billionaires with bitcoin today are rare. For example, the Winklevoss twins invested about $ 11 million when BTC averaged about $ 120 a penny. The brothers’ fund in bitcoin today is more than 1,000 million dollars.
There is also much in the story of those who sold or used bitcoin in its early days that they would have received billions of dollars if they had only hoodwinked their holdings. This is true of Lazslo Hanyecz, author of the first known purchase with bitcoins: 10,000 BTC for two bitas in 2010. Today, the cost of a simple lunch equates to $ 230 million.
While these figures give the idea that it’s too late to compete with little money and become a “bitcoin millionaire”, there are some who believe it is not. Among the most bullish predictions, one is so old that bitcoin was not even traded by the time it emerged.
Hal Finney, one of the first collaborators of Satoshi Nakamoto, the creator of Bitcoin, did that calculation put the value of each future coin at least $ 10 million, in case of “success”.
Imagine that Bitcoin is succeeding and becoming the dominant payment system in use worldwide. So the total value of the currency must be equal to the total value of all the wealth in the world, ”Finney wrote in response to Nakamoto’s mailing list introducing its” person-to-person electronic cash system “: Bitcoin.
If your calculations are true, a $ 2,300 investment in bitcoin today could turn into a million dollars in that hypothetical future, one where bitcoin has successfully fulfilled its purpose as the dominant payment system.
In the meantime, it would simply be “stack sats” and “hodl”, a bitcoiner would say recommending a withdrawal plan. There is no timeline for that to happen, so the plan could not be for later years whoever decides to invest. Perhaps for his succeeding generations.
And to think that basic term in bitcoiner capture philosophy started out as a mistake. He typed a word, in full drunkenness, an admitted evil trader who preferred not to venture and a phone that failed to process his attempt to trade bitcoin.