Second Bitcoin Exchange -- Dustin Dollar's BitcoinMarket.com

2010 Jan 15 See all posts

Author

Satoshi Nakamoto

Email

satoshinakamotonetwork@proton.me

Site

https://satoshinakamoto.network

As far as I know, the second pioneering initiative to create a price for Bitcoin comes from dwdollar, whose real name is Dustin Dollar. He has been a well-known contributor to the Bitcointalk.org forum. This is a Bitcoin exchange site called BitcoinMarket.com.

The very first post of dwdollar on Bitcointalk.org was to announce his plans to create a Bitcoin exchange, when he posted on 15 January 2010:

Hi everyone. I'm in the process of building an exchange. I have big plans for it, but I still have a lot of work to do. It will be a real market where people will be able to buy and sell Bitcoins with each other. In the coming weeks I should have a website with a basic framework set up. Please bear with me.

dwdollar's announcement of Bitcoin Market on 15 January 2010

Again on 6 February 2010 in an update he added that:

I am trying to create a market where Bitcoins are treated as a commodity. People will be able to trade Bitcoins for dollars and speculate on the value. In theory, this will establish a real-time exchange rate so we will all have a clue what the current value of a Bitcoin is, compared to a dollar. I have an early version up at http://98.168.168.27:8080/

dwdollar was adamant that the exchange should reflect real trading between market participants and not the production costs of Bitcoin:

Unless there is a way to determine demand, no one will be using them as a currency. Even now, every Bitcoin has a value. The key is finding it and tracking it.

I want this to be a real market where buyers and sellers determine the value based on their demand. It will match buyers and sellers (it can already do that) accordingly. I will only be a broker. I don't think we should be worried about what the value is.

Our main concern should be accurately determining that value as it fluctuates.... The fact we are worrying about people dumping Bitcoins suggests we haven't determined an accurate value yet.

The Bitcoin Market (a.k.a. BCM) site went live in March 2010 and used PayPal for cash handling (also adding Pecunix gold grammes (GAU) and Liberty Reserve (USD) at later dates). On 16 March 2010, dwdollar posted on the Bitcointalk.org forum saying that he had:

created an account and placed a bid for 500 Bitcoins @ $.0067/BC which I think is NewLibertyStandard's current exchange rate.

This 16 March 2010 rate of $0.0067 per coin, which was 67 cents for 100 coins, was 8.77 times more than the NewLibertyStandard's starting price that had been specified on 5 October 2009, less than 6 months earlier.

On 17 March 2010 (St Patrick's Day), dwdollar posted another message that:

There are 9 people signed up but only 3 have made a deposit so far. Myself makes 4. Looks like we had our first real trade around noon!

Interestingly, a few days later on 20 March 2010, there was a reply to dwdollar's post on the Bitcointalk.org forum from Jon Matonis, who said:

Hi, very exciting news about the momentum building for Bitcoin. I just posted a summary on my economics blog, "The Monetary Future", which can be found at https://themonetaryfuture.blogspot.com/2010/03/bitcoin-peer-to-peer-electronic-cash.html

The blog focuses on digital online exchangers and anonymous digital currencies penetrating the market so that we may all protect our financial privacy. Should be interesting and entertaining for many on this forum."

Update

Bitcoin Market in its About page claims that "it is the first to offer a free-floating exchange rate and an escrow trading system." It incorporats as Bitcoin Market LLC in September 2010. A new Bitcoin Market site was rolled out in October 2010 with Dustin Dollar (a.k.a dwdollar) as the developer of the Bitcoin Market website and owner of Bitcoin Market LLC.

BitcoinMarket.com Bitcoin exchange on 26 August 2011, price $10 – $15 per BTC