It usually takes time between the moment a breakthrough technology emerges and its mass application. Diffusion of innovation explains how users or other companies adopt and use new technologies (Rogers, 1962). According to this concept, any innovation is initially supported by a limited number of people, and only later is the new technology accepted by the majority of society. This paper will give an example of a company officially registered as “Satoshi Nakamoto,” which created and implemented one of the first and most popular cryptocurrencies – Bitcoin.
Initially, an author or group of authors under the pseudonym Satoshi Nakamoto created Bitcoin without creating an official company. However, a company with this name was later created to settle financial and other legal issues. Bitcoin became one of the first and most expensive and popular cryptocurrencies. Nevertheless, the popularity of the whole cryptocurrency market and bitcoin itself did not appear immediately. Bitcoin appeared in 2009, and its first transaction did not occur until 2010, when a programmer ordered two pizzas and paid with ten thousand cryptocurrencies (Radziwill, 2018). At the time, bitcoin was worth much less than a dollar.
An estimate of bitcoin’s prevalence and popularity is based on its market value. According to the concept of diffusion of innovation, cryptocurrency technology was not in wide demand at first, but by 2013 the value of bitcoin had risen to $100 (Radziwill, 2018, p. 65). Subsequently, beginning in 2016, the value of bitcoin began to skyrocket, and it began to be used by many companies, such as Tesla (Li J. P. et al., 2021). Bitcoin became an alternative currency that many companies worldwide began to use. Today, it is used in several technology companies, is accepted in several global banks, is officially installed in Excel as a currency, and is actively used in donations and other forms of international transfers.
Thus, Bitcoin, as a brand-new product and one of the most significant financial innovations of the twenty-first century, was initially priced at times cheaper than it is today and was not very popular for several years. Only after a certain period many users and companies took up the use and mining of cryptocurrency, and many are still doing it now, which, according to Rogers’ concept, could be attributed to users who were late adopters of the innovation. The increase in the popularity and use of Bitcoin is most clearly characterized by its price growth, which confirms the diffusion of innovation theory.
Reference List
Li, J. P. et al. (2021) ‘Bitcoin: The biggest financial innovation of Fourth Industrial Revolution and a portfolio’s efficiency booster,’Technological Forecasting and Social Change, 162(120383), pp. 47-62. Web.
Radziwill, N. (2018) ‘Blockchain Revolution: How the technology behind Bitcoin is changing money, business, and the world. ‘Quality Management Journal, 25(1), pp. 64–65. Web.
Rogers, E. M. (1962). Diffusion of innovations. New York: Free Press.