See which celebrities invested in Bitcoin and other cryptocurrencies

The cryptocurrency Bitcoin has seen a lot of ups and downs. Elon Musk and his company Tesla caused a sensation in the market when, in January 2021, they announced that they had bought around $1.5 billion in bitcoins. The news caused more people to have confidence in the digital coin and drove the price up to an all-time high. At one point, it was worth more than $56,000 per coin.

Since 2021, however, the coin has fallen in value. By 2023, it was worth only half of its highest price. In fact, there was one day in 2021 when the price of Bitcoin fell tremendously. With all the coins in his digital wallet, Elon Musk lost about $15 billion within one day, Bloomberg reported.

For many people, cryptocurrencies remain a mystery. What does the fluctuating price of Bitcoin really mean? And what can you do with a Bitcoin or other cryptocurrency? Here's a gallery with all the answers.

They are digital and elusive, and their price can fluctuate by thousands of dollars in a day: cryptocurrencies. While many are hesitant to invest in them, celebrities like Johny Depp, Madonna, and Bill Gates have shown their confidence in the tokens. Here are some important data about the trade and the celebrities involved in it.

Bitcoin, the big champion among the different cryptocurrencies, had its all-time high so far in 2021. It reached 56.2 million dollars per coin by November of that year. In the first half of 2023, however, it did not even reach half that number.

Bitcoin, the first and biggest cryptocurrency, saw the light in January 2009. Since then, a limited number of Bitcoins have been produced in order to keep the currency rare and valuable. Fourteen years after its invention, the total value of all Bitcoins in the world is around $567 billion. That's right: something that did not exist ten years ago, has now become $567 billion worth in digital currency.

Unlike traditional currencies, like the dollar or yen, cryptocurrencies are not real banknotes or coins. Instead, they are long, unbreakable codes stored in clouds or computers. Bitcoins were invented at the height of the 2008-2009 financial crisis. Its makers wanted to introduce a type of money that did not depend on the traditional banking system - an institution that had proven to be unreliable in the 2000s.

The mysterious Santoshi Nakamoto, a pseudonym for the maker(s) of Bitcoin, whom no one has ever met, dreamed of a world in which people could pay with alternative money. They would make transactions amongst each other, without any bank or government interference. Cryptos were an utopian dream.

How could such 'hidden' money be possible? Bitcoins and other cryptocurrencies are made in a process called 'mining.' This proces causes each coin to consists of a unique combination of codes. Their uniqueness is what gives cryptocurrencies their value. They can not be copied nor traced. You can pay with them anonymously and across national boundaries without changing currencies.

After the start of Bitcoin, few people were interested in buying the so-called coded currencies. Among the early adopters was rapper Snoop Dogg. He announced that people could pay for his upcoming album in 2013 with 0.3 bitcoins. There is no information about the number of albums Snoop Dogg sold for bitcoins, but Business Insider estimates that, with their current price, "he could possibly have earned over roughly $1,000 per album."

Mel B, also known as 'Scary Spice' in the pop group The Spice Girls, invited fans to pay for her 2014 Christmas single in bitcoins. To Kryptomoney, she said: "I love how new technology makes our lives easier, and to me that's exciting. Bitcoin unites my fans around the world using one currency."

Microsoft founder Bill Gates, one of the richest people in the world, knows a lot about money as well as computers. He told Bloomberg in 2014 that bitcoin was "exciting," because "you don't have to be physically in the same place" to make a payment.

The codes of your cryptocurrencies are guarded in an online wallet, which should keep them safe from hackers or the tax man. The former boxer Mike Tyson advertised Bitcoin in 2015, offering his famous face tattoo as the logo of a company making Bitcoin wallets.

The security of cryptocurrency wallets is very strong. In fact, it is so difficult to break their passwords that some people who bought Bitcoin in its early days and forgot the password, now own money that they cannot touch. By the time the coin rose in value to the tens of thousands, these early adaptors couldn't get inside their wallets to cash in on them.

At the beginning of 2017, one Bitcoin cost around $1,000. By Christmas of that year, it was worth $19,783. Cryptocurrencies became an enormous hype.

One of the lucky, early investors of Bitcoin was the British actor Hugh Laurie, known for his role in the series 'House.' He bought Bitcoins in 2015 at the advice of a friend. At that time, one Bitcoin was worth €5000. Two years later, the coin had nearly quadrupled in value.

By 2017, more celebs jumped onto the bandwagon of the crypto business. Gwyneth Paltrow became the face of a brand of Bitcoin wallets, and she also advised her followers on Twitter about investing in cryptocurrencies.

The wealthy socialite Paris Hilton also wanted to get involved in cryptocurrencies. In 2017, she decided to buy loads of a new cryptocurrency: LydianCoin. By 2019, this coin was worth $0.003 each, and the total value of all LydianCoins in the world was a whopping.... $8.31.

In December 2017, when Bitcoin was at a high point, many traders regretted not having bought it sooner. They jumped into the market for Fear of Missing Out (FOMO). Unfortunately for them, the coin did not rise in value; it plummeted. New buyers in 2017 had spent nearly $20,000 on a Bitcoin that a year later was worth less than $4,000.

If these investors held on to their Bitcoins, however, they would have made a big profit in 2021 - and even today, they would have more money than at the time they bought their Bitcoins. It's nerve-wracking to watch the values go up and down though: that's why they encourage each other by saying: "Hold on for Dear Life" (HODL).

Bitcoin long struggled to go beyond $20,000 because there have been many scandals surrounding cryptocurrencies since 2017. Hackers and scammers stole millions of dollars from unaware investors, showing that the code was not so secret and safe after all.

While Bitcoin forms 48% of the cryptocurrency market, there are many other coins. Two top cryptos are Ethereum and Litecoin. Ethereum started 2023 at approximately $1.100, went to around $1.900, and then fell to $1.600 again. Meanwhile, Litecoin rose from $66 to $103 before falling back to $79.

Asian companies hosting cryptocurrency markets, especially in Hong Kong, and investors buying the tokens, most of all in South Korea and Japan, have given a great impulse to cryptocurrencies worldwide.

The coin XRP, formerly called Ripple, is also in the top 5 of cryptocurrencies. This coin is very cheap, only $0.61, but there are many of them and their total worth is $36 billion. Both Snoop Dogg and Madonna are fans of Ripple. The Queen of Pop got some "generous" donations from Ripple for her Raising Malawi foundation, Business Insider reports.

Tether is a so-called stablecoin, which means it is connected to the US dollar and always stays around $1. Real crypto fans are not excited about Tether, because the coin is dependent on a traditional currency and does not fit in the utopia of bank-free money.

Digital currencies are especially popular in countries where traditional currency is moving up and down a lot. Examples are Turkey, with its uncertain Turkish lira, and Argentina, with its inflated Argentine peso.

Venezuela has been the country with the most extreme hyperinflation in the past decade. The Venezuelan Bolivar has evaporated in value by the day. So what did President Nicolas Maduro decide? He announced a steady, unbreakable cryptocurrency for Venezuelans: the Petro (referring to the country's main export product, oil).

The cryptocurrency market attracts a lot of young investors who hope to make a quick buck with a fast-rising coin. They can either short the coins, buying and selling them within the same day to profit from their fluctuating prices, or they can go long. This means that they buy the coin and wait until its value goes up - even if it takes years.

There are other interesting coins, for example, the one introduced by Facebook. Yes, Mark Zuckerberg is also participating in the crypto hype. He launched a cryptocurrency, Libra, that would enable people from all over the world to make payments to each other via his company's social networks.

The Libra coin from Facebook and its parent company Meta was controversial from its inception. Central banks and governments protested because they worried that payments through Facebook would not be safe, or that they would influence the world financial sector too much. In the end, Meta changed the coin's name to Diem, after which the crypto went bust. It is no longer in use now.

Ashton Kutcher invested in a cryptocurrency called UnikoinGold. It was made by an e-sports gambling site to enable its players to pay with an internationally exchangeable coin.

Athletes with a lot of money to burn are also interested in the crypto business. Boxer Floyd Mayweather invested in several new digital coins, while Leo Messi is the brand ambassador for a company producing a special smartphone for cryptos.

Johnny Depp invested in a company that gives tokens to people who use, comment on and share its online films and games.

So far, the use of cryptocurrencies has been limited. While some of them are really expensive and others flop, none of the coins has managed to replace the old dollars, yens, and euros. So far.