First Steps: Value Discovery
💡 Witness Bitcoin's historic breakthrough from worthless to valuable. From New Liberty Standard's first price anchor to Laszlo Hanyecz's two pizzas, Bitcoin completed its crucial leap from technical experiment to real-world commodity. 10,000 bitcoins for two pizzas—this wasn't luxury, but revolution—how value is discovered, confirmed, and transmitted in a permissionless network.
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"Bitcoin may really have no intrinsic value, but it will have exchange value. If enough people believe it has value, then it has value."
——Satoshi Nakamoto, February 18, 2010, BitcoinTalk forum
📅 2009, Bitcoin's first year
In BitcoinTalk forum, Bitcoin was like a "digital toy," casually given away by geeks and easily ignored by newcomers. It was interesting, elegant, running perfectly, but lacked a recognized value measure.
Programmers would say: "I'll transfer you 1,000 bitcoins to play with." Newcomers would ask: "What can this thing actually do?" Skeptics would laugh: "Digital garbage with no value." Satoshi would answer: "Time will prove everything."
Without prices, value remained only in feelings and imagination. People needed a ruler to measure this nascent flame. But the question was: how should something unprecedented be priced?
Birth of the First Value Ruler
📅 October 5, 2009, a website called New Liberty Standard first attempted to answer this question. The site was operated by Finnish programmer Martti Malmi, the same person who created BitcoinTalk forum. As one of Bitcoin's earliest supporters, he deeply understood that Bitcoin needed a reasonable price anchor to communicate with the outside world.
His pricing method seemed simple but was actually thoughtful: calculating Bitcoin's fair value based on mining electricity costs. The calculation logic was straightforward—estimate the electricity consumption needed to mine 1 bitcoin, calculate costs based on average U.S. electricity prices, and determine how many bitcoins 1 dollar could exchange for.
Thus, humanity's first official Bitcoin exchange rate was born: 1 dollar = 1,309.03 bitcoins, or conversely, 1 bitcoin ≈ $0.000764.
This exchange rate wasn't the result of market competition but a "theoretical price line" based on costs. But its historical significance was immeasurable—it provided the first replicable pricing standard, made abstract value quantifiable for discussion, established the "energy value anchor" price theory, and laid foundations for subsequent market trading.
More importantly, this pricing method implied a profound insight: Bitcoin's value comes from invested work, strikingly similar to gold's value logic under the gold standard. New Liberty Standard didn't just give prices but actually began trading bitcoins with people at this price, becoming Bitcoin history's first formal "exchange"—though it was more like a manually operated exchange service.
📅 October 12, 2009, just one week after New Liberty Standard announced exchange rates, history's first formal Bitcoin purchase transaction quietly occurred. The buyer was Martti Malmi, the seller was New Liberty Standard, and the payment method was PayPal transfer. Malmi paid $5.02 and received 5,050 bitcoins, at an actual rate of about 1 dollar for 1,005 bitcoins, slightly better than the official rate.
This seemingly insignificant transaction actually had epoch-making significance. Technically, it proved Bitcoin could seamlessly interface with traditional payment systems. Economically, it established the first real exchange rate between Bitcoin and fiat currency. Institutionally, it created the first replicable trading process. Psychologically, it transformed Bitcoin from "technical experiment" to "valuable commodity."
More interestingly, Malmi was simultaneously the buyer, forum creator, and early Bitcoin development team member. He used this transaction to prove to the world: Bitcoin wasn't just a programmer's toy but real money. This $5.02 might be one of history's highest return investments. By 2025 Bitcoin prices, those 5,050 bitcoins are now worth over $500 million, representing approximately 100 million% return on investment.
Over-the-Counter Trading and Community Trust's Emergence
After New Liberty Standard pioneered this precedent, BitcoinTalk forum's "Economics and Trading" section began becoming active. These early trades were completely trust-based—buyers and sellers didn't know each other, relying entirely on forum reputation. Pricing was arbitrary with no unified standards, completely negotiated between parties. Payment methods varied from PayPal to bank transfers, even mailing cash. Risks were self-borne with no guarantee mechanisms.
Typical trading posts would read: "Selling 10,000 bitcoins, price $100, PayPal payment, $0.01 per bitcoin, negotiable, buyer pays first, message for questions." Price volatility was extremely dramatic—sometimes nearly free giveaways, sometimes reaching $0.05-0.08 per bitcoin, with average prices between $0.003-0.01, often with 10x spreads.
To establish trust, the community spontaneously formed primitive reputation systems. Some specially maintained reputation threads recording all successful transactions, reputable users provided third-party escrow services, fraud was publicly warned against, and mutual evaluations followed completed transactions. These primitive institutional arrangements later became design blueprints for all cryptocurrency exchanges.
In this idealistic community, one figure was particularly notable: Laszlo Hanyecz. This programmer living in Jacksonville, Florida, wasn't just an early Bitcoin user but an important technical contributor. He developed the first GPU mining program, improving mining efficiency dozens of times; created the first Mac OS version of the Bitcoin client; contributed numerous patches and improvements to Bitcoin core code.
Having developed GPU mining software, Laszlo accumulated large amounts of bitcoins in early 2010. At his peak, he could mine thousands of bitcoins daily, with total holdings estimated over 100,000. But Laszlo faced a "sweet burden": I have so many bitcoins, but I want pizza!
As a pragmatist, Laszlo wasn't satisfied with Bitcoin merely circulating in forums. He wanted to know: Can Bitcoin buy real goods? Can it be used in the real world? 📅 May 18, 2010, Laszlo posted a seemingly casual thread on BitcoinTalk forum that would rewrite Bitcoin history.
History's Most Famous Takeout Order
The thread title was simple: "Pizza for bitcoins?" The content was straightforward:
"I'll pay 10,000 bitcoins for a couple of pizzas... like maybe 2 large ones so I have some left over for the next day. I like having left over pizza to nibble on later. You can make the pizza yourself and bring it to my house or order it for me from a delivery place, but what I'm aiming for is getting food delivered in exchange for bitcoins where I don't have to order or prepare it myself, kind of like ordering a 'breakfast platter' at a hotel or something, they just bring you something to eat and you're happy!"
Transaction requirements were specific: 10,000 bitcoins for 2 large pizzas, toppings including onions, peppers, sausage, mushrooms, tomatoes, pepperoni, etc., delivery location in Jacksonville, Florida, contact via forum private message.
This seemingly casual post actually posed a profound question: Can digital currency be used for real-world commodity trading? In that era, this was an unprecedented experiment. No merchants accepted Bitcoin, no payment processors existed, no mature infrastructure was available. What Laszlo proposed was essentially a peer-to-peer commodity trading scheme.
📅 May 22, 2010, history's turning point arrived. A 19-year-old British university student named Jeremy Sturdivant (forum username: jercos) replied to Laszlo's post. Jeremy was interested in Bitcoin and wanted to obtain some for experimentation.
The transaction process was surprisingly smooth. Jeremy negotiated details with Laszlo via forum private message, then used his credit card to order on Papa John's website. Two large pizzas were delivered to Laszlo's Jacksonville home, Laszlo transferred 10,000 bitcoins to Jeremy through the Bitcoin network, and both publicly confirmed the successful transaction on the forum.
The specific transaction record was permanently etched on the Bitcoin blockchain: Transaction time May 22, 2010, transaction hash a1075db55d416d3ca199f55b6084e2115b9345e16c5cf302fc80e9d5fbf5d48d, transfer amount 10,000.00000000 bitcoins, block height 57043, pizza cost $40.94 (including tax and tip). By then-current real-time exchange rates, Bitcoin price was approximately $0.004094 each, total value about $41.
When Laszlo bit into the first slice of pizza, he might not have realized he was rewriting human monetary history. This was humanity's first recorded purchase of physical goods with pure digital currency, proving Bitcoin wasn't just a technical experiment but a real medium of exchange. Through this transaction, Bitcoin established value anchoring with real commodities: 10,000 bitcoins equals 2 pizzas equals $41, 1 bitcoin equals $0.004094.
The entire transaction process verified Bitcoin payment's complete closed loop: demand expression, supply-demand matching, price negotiation, commodity delivery, payment completion, transaction confirmation. A British student ordered for an American customer, Bitcoin achieved cross-border payment without banks or payment processors. The entire process involved no intermediary institutions, relying completely on peer-to-peer collaboration.
Legendary Reflection: From $41 to $10 Billion
Let's use numbers to feel this transaction's historical impact. On transaction day May 22, 2010, 10,000 bitcoins equaled $41, 1 bitcoin equaled $0.004094. By January 2025 prices, 10,000 bitcoins are worth approximately $1.09 billion, representing about 26.6 million% return. By this return rate, each pizza bite was worth about $545 million, each second of chewing was worth millions of dollars—possibly history's most expensive fast food.
Media loves using mocking headlines to report this story: "History's Most Expensive Pizza," "The Billion-Dollar Takeout," "The Most Regretful Programmer," "Missing Ten Billion in an Instant." But these mockeries miss the point. Measuring 2010 transactions with today's prices is like mocking Ford's Model T with current automotive technology—completely missing historical significance.
Laszlo's real contribution was proof of concept—he proved Bitcoin's payability through action, more convincingly than any technical documentation. He broke psychological barriers—many viewed Bitcoin as technical toys or speculation tools; Laszlo proved it was real money. He established use cases, providing referenceable transaction templates for other merchants and consumers. He promoted price discovery, establishing Bitcoin-commodity value relationships through real transactions.
On May 24, 2010, Satoshi Nakamoto replied to this transaction thread on the forum: "Congratulations laszlo! Great work!" These few words reflected Satoshi's high approval of this transaction. For Bitcoin's creator, technical success wasn't the ultimate goal—technology being adopted by the real world was.
As early as 2009, Hal Finney predicted Bitcoin's enormous value potential. He wrote on the forum: "Imagine if Bitcoin succeeds and becomes the world's primary payment system, then the coins' total value should equal all the world's wealth. Current global household wealth is estimated between $100-300 trillion, so each bitcoin would be worth about $10 million." By this prediction, Laszlo's 10,000 bitcoins would eventually be worth $100 billion.
The pizza transaction's success triggered a chain reaction. More merchants began considering accepting Bitcoin payments, Bitcoin users began habitually using it for daily shopping rather than just technical experiments, mainstream media began reporting on Bitcoin and this "strange digital currency," and some investors began recognizing Bitcoin's investment value.
Unexpectedly, Laszlo didn't regret "missing ten billion." He continued contributing code to Bitcoin open source projects, developed multiple Bitcoin-related tools and applications, and played important roles in Lightning Network development. In a 2018 interview, Laszlo said: "I don't regret buying pizza with bitcoins. If no one started using Bitcoin, it would never have value. I'm proud to be the first person to buy goods with Bitcoin—this is more meaningful than holding them."
In 2018, Laszlo again bought pizza with Bitcoin, this time using Lightning Network: 2 pizzas, price 0.00649 bitcoins (about $67), payment through Lightning Network, verifying Bitcoin payment technology progress. From 2010's "Bitcoin Pizza Guy" to 2018's "Lightning Pizza Guy," Laszlo remained Bitcoin payment application's pioneer.
To commemorate this historic moment, the Bitcoin community designated May 22 as "Bitcoin Pizza Day." Bitcoin enthusiasts worldwide buy pizza with bitcoins, Bitcoin companies organize pizza parties, social media features #BitcoinPizzaDay hashtags, and various commemorative articles and videos emerge endlessly. Bitcoin Pizza Day isn't just tribute to Laszlo but annual celebration of Bitcoin's practicality. It reminds people: Bitcoin isn't just an investment tool but usable currency.
Interestingly, Papa John's (the chain that provided pizza back then) later officially began accepting Bitcoin payments, honoring this history.
Bitcoin's value discovery process can be summarized in three key stages. Stage one was theoretical value: New Liberty Standard's cost pricing model established the first price anchor, proving Bitcoin "could have prices." Stage two was trading value: Martti Malmi's first purchase and forum over-the-counter trading emergence proved Bitcoin "could be traded." Stage three was use value: Laszlo's pizza transaction and commodity purchase complete closed loop proved Bitcoin "could be used."
Each stage built on the previous stage's foundation, gradually constructing Bitcoin's value system. Key insights include: value is discovered, not created; use builds value more than speculation; pioneers' contributions are often underestimated; technology's success requires real-world verification.
When we look back at Bitcoin's value discovery journey, we find this wasn't a linear process but an accumulation of brave experiments. New Liberty Standard provided theoretical foundation, Martti Malmi completed the first transaction, Jeremy Sturdivant became history's participant, and Laszlo Hanyecz realized value's application. Everyone played indispensable roles in this epic story.
Bitcoin's value wasn't determined by any authority but gradually established through countless individuals' free choices and actions. This perfectly embodies Austrian economics' core viewpoint: value is subjective, determined by market participants' preferences and actions. From worthless to valuable, from the first price anchor to two pizzas, Bitcoin completed its crucial leap from technical experiment to economic reality. It proved decentralized currency could have prices, could exchange with fiat currency, could purchase real-world goods, and could establish trust between strangers.
From this moment, Bitcoin was no longer cypherpunks' technical toy but became real money. It possessed money's three basic functions: medium of exchange (could buy goods), store of value (could preserve value), unit of account (could price goods). The pizza transaction's success marked Bitcoin's completion of its final leap from concept to reality. The following story would involve greater challenges and more intense collisions.
Every May 22nd, Bitcoin enthusiasts worldwide buy pizza with bitcoins to commemorate this historic moment. Laszlo Hanyecz also became one of Bitcoin history's most famous "influencers." In 2020, on Bitcoin Pizza Day's 10th anniversary, someone calculated that if Laszlo had held those 10,000 bitcoins, they would be worth nearly $100 million. But as Laszlo said: "Without anyone using it, Bitcoin would never have value."