Bitcoins Raise Price of Pizza

The first real-world transaction using bitcoins happened in May 21, 2010 when Florida-based Lazlo Hanyecz  sent 10,000 bitcoins (BTC) for two pizzas. He used online-only open source cryptocurrency to an England volunteer who used to spend around $25 for a Papa John’s for Hanyecz.

Upon the launch of the currency in February 2010, one bitcoin was just worth $0.03. That time, Laszlo had plenty of bitcoins and thought of using them for dinner. He posted at BitcoinTalk.org, the primary forum for the currency:

“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! ...

 

If you're interested please let me know and we can work out a deal.

 

Thanks,

Laszlo”

Other programmers advised him to just use his bitcoins in other ways, like selling them in exchange for real dollars. But one programmer replied and agreed to take his bitcoins. Lazlo told him about online delivery and charging through credit card. The line went dead but as Laszlo logged back, he declared that he had completed the first ever transaction of cryptocurrency for real-world goods. "I just want to report that I successfully traded 10,000 bitcoins for pizza," he wrote. He even posted photos as proofs. A Bitcoin member, Ounce.me posted the value of the bitcoin used for the transaction in the dollars.


But now, a single BTC is now worth $75. Due to the financial crisis in Cyprus, Europeans were urged to buy BTC at the said rate. With this, we can also say that the value of pizza Lazlo purchased is now amounting to a whopping $75,000. This may make Laszlo appear a dumbass for buying a pizza at that cost. But if not for Laszlo’s transaction, the value of a bitcoin will still remain worthless at present. It was actually wise for him to make use of the cryptocurrency which worth really less at that time for a pizza delivery. He proved that bitcoin can actually be useful. The transaction made the currency valuable.


Even though the value of bitcoin rises and Bitcoin Pizza Index hit $270,000 in 2011, Lazlo won’t regret it. "I don’t feel bad about it. The pizza was really good.”

Lazlo’s  transaction raised the spirits of the early community members. In November 2010, member da2ce7 wrote, "It is so remarkable how far this economy has progressed in such a short time. This breaks every record that I can think of."

Two years later, the currency has been more widely acceptable. There are businesses, like PizzaForCoins.com that are converting bitcoins to pizzas. Reddit proved that the first ever bitcoin transaction in UK was made by a member ozzysmygod with pictures posted as evidence, as well.

And the two monumental transactions each speak volumes about the evolution of the crytocurrency that's kept on chugging: one was executed on a whim, for the hell of it, in the halls of a half-empty online forum populated by a few diehard programmers. Now, the mere creation of a website that orders pizza for bitcoin gets you a writeup in the likes of Forbes and the Wall Street Journal.

Bitcoin is still exponentially growing and widely used at present. Even Goldman Sachs and Morgan Stanley have been spending time in bitcoin exchanges, according to Reuters. In today's BTC, that famous pizza may actually turn out to be the most expensive ever delivered.

One Bitcoin Talk member named Rubick asked, "Will this eventually become the world's first million-dollar pizza?"

Who knows, it might actually be.



Posted by Diane Araga, on April 12, 2013 at 8:00 AM