The internet economy and crypto: Why Bitcoin is only just beginning

4 min readJul 5, 2021

Much has changed in the world of crypto since the launch of Bitcoin, the first-ever cryptocurrency, in 2009. In the 12 years that have followed this pioneering project, the crypto ecosystem has expanded to include thousands upon thousands of coins and tokens underpinned by a vast array of different projects and technologies.

These new entrants include the Ethereum blockchain and its currency Ether: the world’s second-largest cryptocurrency by market capitalization. Launched in 2015, Ethereum has earned the label “the world’s computer” thanks to its fully programmable functionality that has allowed for entire ecosystems to operate and flourish on it.

This includes, most notably, decentralized finance (DeFi), the first iteration of a viable system of banking and investing on the blockchain that now houses more than $100 billion of assets. Today, DeFi has expanded beyond Ethereum to new layer 2 solutions and blockchains that have been built specifically to accommodate it. Beyond these key areas, there are the burgeoning worlds of non-fungible tokens (NFTs), on-chain gaming, entire decentralized cities, and of course, dog-themed meme coins.

Bitcoin still dominates crypto

Despite all this, however, Bitcoin still accounts for nearly half of the entire crypto ecosystem. Today, Bitcoin and its market capitalization of $667 billion (as of July 4) makes up over 43% of the crypto universe — nearly three times that of Ether’s $227 billion. And this is all after the flagship cryptocurrency’s latest break-neck plunge from a high of $63,576 on April 14 to a low of $31,711 on June 22 before settling in its current range of around $33,000 to $35,000 (as of July 4).

Of course, it’s not been a great few months for Bitcoin. After a stellar and record-breaking start to the year, the man that arguably put the cryptocurrency on its trajectory to the top dragged it all the way back down again. In May, eccentric billionaire Elon Musk sent Bitcoin tumbling when he u-turned on allowing Tesla buyers to pay in Bitcoin, and all in the same week China launched its latest crackdown on cryptocurrency.

The latter arguably has a bigger influence on Bitcoin than Musk: around 75% of Bitcoin mining happens in China, or at least it did. It seems the leaders of the People’s Republic of China really mean it this time and so miners are packing up and heading West. Indeed, the US may even see significant Bitcoin mining return to its shores as energy-rich state Texas opens its doors wide to wandering miners.

The long-term trend remains positive

As heavy as these issues may currently be weighing on Bitcoin’s price, though, they remain short-term factors in its history. Indeed, despite the recent plunge, Bitcoin remains the most profitable asset the past decade has given rise to.

From $31 per coin in early July 2011, the world’s biggest cryptocurrency now sits at around $35,500 — total growth of over 114,000%, or annual growth of around 100% per year. There is no other asset that has done the same. Even Apple, now the world’s most valuable company, has “only” seen its share price grow by 1,036% in the past ten years, while Amazon’s shares have seen a shade over 2,800% growth [Source: Google Finance].

This year has also, of course, witnessed some very positive developments for Bitcoin. It is being increasingly used as a means of buying and selling goods in developing countries with hyperinflation (one of Bitcoin’s original intended use cases), with El Salvador having officially adopted it as legal tender and other South American countries looking to follow suit.

In addition, an ever-growing number of companies have been buying Bitcoin up, including global tech powerhouse Micro Strategy, and of course, Tesla. Institutional investors also continue to pile in, the most gratifying (for crypto enthusiasts, anyway) being JP Morgan, which this year launched a Bitcoin fund for its private clients despite CEO Jamie Dimon’s now-infamous 2017 threat to fire any employee that touched Bitcoin.

The vanguard of the internet economy

The past ten years have witnessed a seismic change in how we as humans live our lives. After a false start in 2001, the last decade has seen the internet rise to become the dominant global force.

Online payments have become the norm in this new system while the internet-based subscription economy is booming. Indeed, of the world’s top ten most valuable companies, seven are tech firms and five are internet specific. Bitcoin, as the world’s first-ever internet-based currency, is at the very vanguard of this new world.

While Google, Facebook, and Amazon are now deeply entrenched in our lives, Bitcoin and the crypto universe growing up around it are barely at the teething stage. Many still doubt it, including the founder of the world’s tenth biggest company, Berkshire Hathaway.

Just as nonagenarian twentieth-century industrialist Warren Buffett was very wrong on Apple, though, he is even more wrong on Bitcoin. Bitcoin remains the biggest, brightest, and most potentially transformational technology to emerge yet, and we are only at the beginning.




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