ARE WE ON THE
MOON YET?

Sixteen months after the genesis block, a developer known as 'dwdollar' launched BitcoinMarket.com: a bare-bones order book connecting Bitcoin sellers with buyers paying via PayPal. The first recorded market price of a bitcoin was a fraction of a cent, negotiated between strangers on a forum. It was primitive, illiquid and historic — every exchange since is a descendant of this one.

Jed McCaleb had built mtgox.com in 2007 to trade Magic: The Gathering Online cards. When he discovered Bitcoin, the order-book code turned out to be the perfect fit: by 2013 the Tokyo-based exchange, run by Frenchman Mark Karpelès, handled roughly 70% of all bitcoin trades in the world. 'Magic: The Gathering Online Exchange' became, for a while, the entire market.

An attacker compromised an auditor's computer, used it to place a huge sell order that crashed the price to pennies, and bought the dip with stolen credentials before the trade was rolled back. Around 2,000 accounts were affected. The exchange survived and users returned — the first demonstration of an industry pattern: hacks get forgiven, until the one that doesn't.

Brian Armstrong and Fred Ehrsam started Coinbase in San Francisco with the opposite thesis to the offshore wild west: work with regulators from day one, start as a simple broker, bank with proper institutions, and grow slowly enough not to break. It was a long, unfashionable bet. It eventually walked onto the Nasdaq.

As Litecoin, Ripple and dozens of altcoins appeared, a new generation of exchanges came online: Kraken (founded 2011, launched 2013) in the US, Bitfinex (2012) serving advanced traders, Poloniex (2014) becoming the altcoin hub. Trading was no longer one market for one coin — it was an ecosystem of order books, and the exchange was its center of gravity.

After weeks of frozen withdrawals blamed on 'transaction malleability', Mt. Gox went dark on 24 February 2014 and filed for bankruptcy days later. Missing: approximately 850,000 BTC — around 4% of all bitcoin that will ever exist, worth ~$470 million then and tens of billions later. Karpelès was eventually convicted only of record tampering (suspended sentence); rehabilitation proceedings began repaying creditors a full decade on, in 2024. The lesson — 'not your keys, not your coins' — was written in that bankruptcy filing.

A breach of Bitfinex's multi-signature setup let attackers drain 119,756 BTC (~$72 million at the time). The exchange's response became its own chapter of exchange history: it socialized the loss across all users via a 36% haircut, then issued BFX tokens as IOUs that were eventually honored in full. Painful, improvised, and a template for how NOT to run custody — even if it ended better than anyone deserved.

Changpeng Zhao and Yi He launched Binance during the ICO summer of 2017 with a model the industry hadn't seen: hundreds of altcoin pairs, aggressive listing speed, and the BNB token that discounted trading fees and funded quarterly burns. Within six months it was the world's largest exchange by volume — a position it has held almost continuously since, through an exodus from China, a $4.3B US settlement (2023), and Zhao's pardon (2025).

Hayden Adams, a laid-off mechanical engineer, shipped Uniswap on Ethereum: no order book, no listing process, no CEO to subpoena. Instead, an automated market maker where anyone could provide liquidity to a token pair and prices came from the formula x·y=k. It barely registered at launch. By 2024, Uniswap regularly processed more daily trades than Coinbase. The DEX era had a flagship.

On 14 April 2021 Coinbase went public via direct listing at a reference price of $250, opening around $381 and briefly valuing the exchange above $85 billion — more than the market cap of most of the assets it listed. The crypto exchange, once a offshore gamble, was now a line item in pension funds. The 'to the moon' crowd and the compliance department officially shared a building.

On 21 February 2025, attackers attributed to North Korea's Lazarus Group compromised a Safe{Wallet} signer and drained roughly $1.4 billion in ETH from Bybit's cold wallet — the largest exchange theft in history, dwarfing Mt. Gox in dollar terms. Unlike 2014, the exchange survived: reserves were bridged within days, withdrawals never halted, and most funds were later frozen or tracked. The industry's worst day had become survivable — progress, of a kind.