Bitcoin Almost Became Centralized

Bitcoin is currently having a very bad time. Last I checked it was in the 27 thousands, a 12000 dollar drop more or less, since the start of May. Well, in this period while we all eagerly wait and try to stabilize the market again, let's head back about 8 years, when about 850000 bitcoins were stolen. Yeah you read that right, lot of zeros there. But before that, we must know about the event that almost made the most decentralized currency, centralized.

So back in the 2010s, there was this card game called "magic the gathering" and some guy named Jed McCaleb planned for a website where people could trade their cards. As in buying or selling. The site was doing well, many exhanges were happening. Then after a while, McCaleb got bored. He stopped maintaining the site and eventually the site was downed. Then he got another plan. He wanted to use this site to exchange bitcoins instead of trading cards. The site came online again, but this time as a Bitcoin exchange. By the way the site was named mt.gox. So this time too the site was doing well. Bitcoin was just starting to be a thing back then. Enthusiast people were hopping in the Bitcoin train. And Jed thought that because there is no proper place to buy sell or exchange bitcoin, he could do it as he already had an unused setup. That was how the Bitcoin exchange took place. But our good friend McCaleb went bored again! God knows what interests him eh? Anyway, he put the site on the shelf again. Then came 2011. A new guy comes into the picture. Jed sells the website to a guy named Mark Karpeles. And this is the beginning of some uncanny events.

After Mark took over, mt.gox really took off. Everyday thousands of dollars worth of bitcoins were exchanged in that site. And as I said earlier, there were no good place to trade bitcoins. Mt.gox was the only trusted place. Yes, there were another few sites that played the broker part, but mt.gox got people's trust. And everyday more and more people started to do their Bitcoin business on mt.gox. And in a couple years, mt.gox was exchanging 150000$ worth of bitcoins everyday. And that number kept rising. And as you all know. The proper flow of a currency makes the currency valuable, so Bitcoin prices also rose up as mt.gox was operating smoothly. So Mark Karpeles one day saw the price going too high and thought he should put some brakes on it. So he stopped all transactions on mt.gox for a day, to "cool down" the whole Bitcoin market. And that day Bitcoin prices fell. And after when mt.gox resumed business, the prices became stable again. So one guy single handedly manipulated the market of Bitcoin.

You see where this is going? The system that Satoshi Nakatomo wanted to be decentralized, was looking more centralized than ever. Mt.gox controlled about 60-70% of the exchange market. And that itself explains how much power mt.gox hand over Bitcoin. The decentralized dream seemed to be over. As within 3-4 years of it's launch, mt.gox happened. But that's only half of the story, of course I'll get to the 850000 bitcoins part. Till then, have a good one.