Nowadays, as of writing, in December of 2023, there are many cryptocurrency exchanges from centralized (CEX) to decentralized (DEX), where you can exchange Bitcoin to fiat currencies, stable coins, altcoins and even physical items. They are abundant nowadays but in the past, having an exchange to trade bitcoin is a dream.
Let's see what is a first Bitcoin exchange, how it looks like.
The first Bitcoin exchange in history is
New Liberty Standard.
- The exchange owner has an account on Bitcointalk.
- NewLibertyStandard with an user ID is 26. It means the person is one of very first members of this forum.
How it looks like?
See three archives
How was the exchange rate calculated?
Exchange RateWe Sell 1,578.76 Bitcoins for $1.00 USD Plus PayPal Transaction Fee.
We Buy1,578.78 Bitcoins for $1.00 USD Minus PayPal Transaction Fee.
$100.00 USD Available
15,100.00 Bitcoins Available
PayPal Transaction Fee Calculator
12/28/2009
To buy or sell bitcoins, please send an email to
newlibertystandard@gmail.com stating how many bitcoins you would like to buy or sell. Currently only PayPal is accepted for payment. The rate changes at midnight Greenwich Mean Time regardless of whether the new rate has been posted. The time at which the financial transaction begins determines the rate for the transaction.
Our exchange rate is calculated by dividing $1.00 by the average amount of electricity required to run a computer with high CPU for a year, 1331.5 kWh, multiplied by the the average residential cost of electricity in the United States for the previous year, $0.1136, divided by 12 months divided by the number of bitcoins generated by my computer over the past 30 days.I ordered a single outlet electrical meter and will probably change my exchange rate to the average production cost over one year. I am going to try to implement this starting January 1st.
The exchange owner has some interesting posts which I quoted below.
1. Because some people are not satisfied with the status quo.
Some people don't like that fiat currencies allow money to be created out of thin air. Using a commodity based currency like bitcoins shrinks the fiat economy and increases the commodity based economy. There's a growing movement in a the United States centered around ending the Federal Reserve and returning to a commodity based currency.
Some people don't like that all electronic financial transactions have to go through and be approved by a large financial institution. Bitcoin transactions don't go through any financial institution, so there's never a fee and transactions can't be declined.
Some people don't like that the government can subpoena your complete financial history and companies can review your credit history without your permission. Bitcoins are like cash in that transactions can be made anonymously and thus can't be subpoenaed by the government or reviewed by companies.
Some people like to earn a little cash on the side with virtually no work required. It's as easy as clicking 'Generate Coins' and opening a PayPal account.
Some people believe bitcoins are a good investment. There are more than a few people interested in using bitcoins and that's all that is needed to guarantee that they will increase in value over time.
Some people use bitcoins because they think that they are an interesting experiment and want to see how and by whom bitcoins will be adopted.
I have had people buy bitcoins from me and sell bitcoins to me. Supply and demand, albeit only a small amount, already exists and is all that is really needed. Offering to exchange bitcoins for another currency is ultimately no different from exchanging bitcoins for goods or services. Currencies are goods and exchanging them is a service. I have been trying to think of something besides USD dollars which I can try to buy or sell using bitcoins, but I can't think of anything. Please let us know about whatever you decide to sell for bitcoins. As for the issue of burning through funds, I have written a daily donation into my budget. You can buy all my USD dollars or bitcoins today, but there will always be more tomorrow and the next day. Each person who buys or sells goods using bitcoins, including exchangers, is increasing the bitcoin economy. Everyone, do your part. Buy or sell something in exchange for bitcoins!
What would you buy or sell in exchange for bitcoins?
Here's what I will buy if the price is right.
Paper bowls, about 10 ounces (295 ml), no more than 50 count factory sealed.
Plastic cups, about 16 ounces (473 ml), no more than 50 count, factory sealed.
Paper towels, preferably regular size Bounty Thick and Absorbent, single roll, factory sealed.
I am just seeking your opinion on some thoughts I had recently. NLS states that he/she calculates how much energy is spent for daily BC production. If more and more BC users are involved in generation, the number of BC NLS produces will go down, for the same amount of energy spent. Hence, the price is bound to go up.
Yes, that's correct. I expect the value of bitcoins to increase as the user base increases and decrease if the user base decreases. I do measure my electricity usage, but it's fairly constant.
I mean, NLS methodology is wrong
Could you be more specific about what exactly is wrong?
My
exchange rate is now influenced by supply and demand in addition to production costs. Bitcoin value will rise and fall in relation to their availability.
Note