Happy Bitcoin Pizza Day!

Why you may ask? Well, it's because today marks the thirteenth anniversary of the first documented time someone used Bitcoin to purchase physical goods. Back on 22 May 2010 as global economies slowly recovered from the financial crisis of the years before, Laszlo Hanyecz a programmer and early Bitcoin miner bought two pizzas from Papa John's. He offered 10,000 BTC, but the fast-food outlet unsurprisingly enough didn't accept Bitcoin as payment! So, he posted a 10,000 BTC offer on Bitcointalk.org and a 19-year old Jeremy Sturdivant took up the offer asking for just $41 in return. At today's valuation, that's now worth more than $270 million!

So, what's the story of Bitcoin in the years since then?

Bitcoin's decentralized nature and limited supply—capped at 21 million coins—contributed to its appeal, sparking particular interest from investors and technologists. Its value experienced significant volatility, with periods of rapid growth, followed by price corrections. It steadily rose in value reaching the milestone $1,000 per coin by 2013. It then reached $20,000 in December 2017. This was then followed by a bear market phase in 2018. However, in 2020, during the COVID-19 pandemic, Bitcoin experienced another major price surge, reaching valuations not previously seen. This rally was driven by various factors including increased institutional adoption, growing interest from mainstream investors, and concerns about inflation and the traditional financial system.

Bitcoin's growth journey continued during the early part of 2021 and its value skyrocketed to an all-time high of over $60,000 by April of that year. This was then followed by another correction and the cryptocurrency's value has remained volatile ever since. Although it’s important to note we are now possibly seeing the signs of what might be another bull market on the near horizon.

Let's now focus on the rise of the institutional adoption of Bitcoin. Here's a few important points to note with reference to specific institutional Bitcoin use cases:

1. Investment: Institutional investors, including hedge funds, mutual funds, and pension funds have started to allocate a portion of their portfolios to Bitcoin. This is often driven by the potential for diversification, hedging against inflation and the belief in Bitcoin's long-term value proposition.

2. Bitcoin Funds and ETFs: Several investment firms have launched Bitcoin funds, allowing accredited investors and institutions to gain exposure to Bitcoin without directly owning and managing the tokens. Additionally, there has been eager anticipation surrounding the approval of Bitcoin ETFs by regulatory authorities in various jurisdictions.

3. Corporate Treasury Reserves: Some publicly traded companies have allocated a portion of their corporate treasury reserves to Bitcoin. This trend gained significant attention when Tesla, led by Elon Musk, announced a significant Bitcoin investment. Other companies have followed suit, seeing Bitcoin as a potential hedge against inflation and a store of value.

CF Benchmarks is the world’s first and leading cryptocurrency index provider, authorized and regulated by the UK FCA. Our indices are in compliance with UK Benchmark Regulation (BMR), proven by two successful audits undertaken by Deloitte.

Our CME CF Bitcoin Reference Rate (BRR) is a once-a-day Bitcoin benchmark, trusted by dozens of financial institutions worldwide. It is the most liquid, regulated Bitcoin price, used for settling hundreds of billions of dollars’ worth of regulated futures contracts in the USA and Europe. It’s also used by asset managers in Canada and the US to calculate the net asset value (NAV) of ETFs, and as the reference price for mutual funds, ensuring these vehicles  are aligned with the regulatory requirements of their various regions.

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