2008: From financial crash to crypto cash

8 Dec 2021

Image: © spyarm/Stock.adobe.com

While most memories of 2008 are clouded by the recession, this year in STEM marked the origin of bitcoin and a deal that made two Irish teens millionaires.

March 2008 brought news of the death of futurist Arthur C Clarke and the end of an era for tech visionary Bill Gates, who stepped down from his full-time role at Microsoft.

The close of Gates’ tenure came amid Microsoft’s aggressive pursuit of Yahoo. A $44.6bn bid to unite the two tech powerhouses against the might of Google was rejected, prompting Microsoft to threaten a hostile takeover. A contentious back-and-forth would roll on throughout the year but, in the end, the acquisition attempt was abandoned and Yahoo CEO Jerry Yang announced he would step down amid criticism of his handling of the negotiations.

Yahoo’s stock took a tumble when Microsoft first walked away from the deal, but that was very much in style in 2008 when the repercussions of the 2007 subprime mortgage crisis rippled across the financial world. In September, the markets were in free fall, and by October, the world was in full-blown financial crisis.

And from the ashes of one financial model, another was born.

The birth of bitcoin

On 18 August, the website Bitcoin.org was officially registered. A couple of months later, a nine-page document titled ‘Bitcoin: A Peer-to-Peer Electronic Cash System’ was published there, accredited to Satoshi Nakamoto. The true identity of the author, or authors, remains unknown to this day.

This paper outlined the model for a decentralised digital currency and an online payments system that would be based on “cryptographic proof instead of trust”. The concept hinged on a public ledger that would prevent fraud or double-spending of digital tokens by adding to a timestamped proof-of-work chain each time a transaction occurred – a blockchain, if you will.

Bitcoin was designed to be used by the collective and advertised as open source, with a public design that nobody controlled. It eliminated the need for centralised financial institutions and banks at a time when both were in crisis. This idea now underpins thousands of cryptocurrencies in circulation today.

Search for the ‘god particle’ begins

While the first blockchain database was quietly devised, scientists made a big bang in September 2008 when CERN, the European research organisation, powered up the Large Hadron Collider (LHC).

Taking more than 10 years to build and stretching to a circumference of almost 27km, the massive circular tunnel on the Franco-Swiss border is the biggest machine ever made.

The LHC was designed to push particles to nearly the speed of light as they travel through its long ring of superconducting magnets. These high-speed particles would collide, revealing the secrets of our universe by recreating conditions similar to those just after the Big Bang. In particular, the LHC set out to confirm the existence of the Higgs boson. This so-called ‘god particle’ was first theorised decades earlier to explain the origin of mass.

As the day of the first test approached, excitement built for some while terror grew for others who feared that the experiment could create an Earth-consuming black hole. Another fear was that the LHC would cause an internet meltdown and around 300 data centres in 50 countries were networked together as scientists around the world, including researchers from Trinity College Dublin, were poised to start processing and analysing the vast quantities of data that would emerge.

And so, on 10 September, the LHC was activated and, despite the doomsday fears, the first test was successful. However, the search for the Higgs boson was put on hold when a 30-tonne power transformer malfunctioned just over a week later. Further complications arose when a helium leak was discovered, putting the project on hold until 2009.

Auctomatic millionaires

While a student at MIT, Irish teenager Patrick Collison set up Shuppa with his younger brother John, who was still in secondary school in Limerick. The duo’s shopping app failed to secure backing from Enterprise Ireland but it did attract the attention of Silicon Valley’s Y Combinator accelerator. It was on this programme that Shuppa was encouraged to merge with Auctomatic, an auction management system for eBay sellers developed by recent Oxford graduates Kulveer and Harjeet Taggar.

Less than a year after Auctomatic was created, it was sold in March 2008 to Canadian media company Communicate.com for $5m. 19-year-old Patrick and 17-year-old John became millionaires from the deal. Communicate.com was renamed Live Current Media and Patrick travelled to Vancouver in May to become its new director of engineering.

Facebook friend request for Dublin

From small start-ups to Big Tech in Ireland, 2008 also marked the decision by Facebook to locate its international headquarters in Dublin. Colm Long, who had been instrumental in establishing Google’s EMEA headquarters in Dublin five years previous, was selected to lead the European operation.

Gareth Lambe would later take over as head of what is now Meta Ireland, having joined the company in 2011. Lambe himself has been working in tech in Ireland for Silicon Republic’s 20-year lifetime, going from the start-up world to a major multinational.

“The growth of Meta (formerly Facebook) and other tech companies here have had a wide-ranging positive impact,” said Lambe. “Tech employees have added massively to Irish society: economically, socially and culturally.”

The economic benefit is obvious: “Billions of euro spent directly into the Irish economy through payroll taxes, capital investment and local suppliers, and that’s before you get to corporate tax and the multiplier effect of so much investment and jobs,” according to Lambe. But he also pointed to the “skills spillover” effect.

“One in four multinational employees now works in a domestic company or has set up their own business in Ireland. Not only are they bringing specialist skills they acquired, but also the very progressive and often leading employment practices that tech companies tend to have.”

Google browses new markets

After the highly successful 2007 launch of the iPhone sparked a smartphone boom, Google and the Open Handset Alliance unveiled Android, an open-source mobile operating system based on the Linux kernel. The first Android smartphones were due to follow in 2008 and it started with the T-Mobile G1 released in September.

More than 1.5m customers pre-ordered the first Android handset while anticipation for more options from Motorola, Samsung and LG was building.

Google also entered the internet browser market when it launched Google Chrome in September. Industry commentators flagged issues ranging from privacy risks to malicious code flaws and vulnerabilities in the beta release, and one analyst forecast “gradual and slow” take-up with success more likely in mobile than desktop browsing.

But by the time of the stable release in December, Google claimed it had attracted more than 10m users in the first 100 days of Chrome.

In other news

7 January: Irish software company Havok wins a Technology & Engineering Emmy.

15 January: Apple introduces the MacBook Air, replacing the traditional hard drive with a solid-state disk for a lighter, thinner package.

13 February: Speedo launches a new line of LZR racer swimsuits developed with the help of NASA’s wind tunnel testing facilities and fluid flow analysis software. The record-breaking performances of athletes wearing the new Speedo suit prompted claims of ‘technology doping’.

19 February: Tim Berners-Lee expands on the semantic web in an interview with SiliconRepublic.com.

19 March: GRB 080319B, a gamma-ray burst detected by NASA’s Swift satellite, sets a new record as the farthest object observable with the naked eye. The afterglow of this deep space explosion took 7.5bn years to reach Earth, meaning the event occurred even before the planet came into existence.

25 April: Nintendo’s Wii Fit is released in Europe.

29 April: Grand Theft Auto IV is released, receiving critical acclaim for its open-world narrative and game design. Considered one of the greatest video games of all time, its record-breaking sales even outdid summer movie blockbuster Iron Man.

14 May: Leo Hennessy, special adviser to the European Space Agency’s scientific directorate, visits Dublin looking to recruit astronauts.

25 May: IBM’s Roadrunner becomes the world’s first supercomputer to achieve a sustained performance of 1 petaflop (that’s one quadrillion floating point operations per second). Later, CTVR researchers in Ireland would join IBM’s project to build a supercomputer 1,000 times faster.

9 June: Apple unveils the iPhone 3G ahead of a July release.

16 June: Offaly company AirAppz offers to install public Wi-Fi networks on all Irish trains at no cost to Irish Rail. It would be two years before Irish Rail would opt to trial wireless internet services on its trains.

23 June: Nokia buys open mobile platform Symbian for €264m.

3 July: Minister for Communications Eamon Ryan, TD, unveils a €435m broadband plan for a nationwide next-generation fibre-optic network utilising State-owned fibre technology, with the intention of making broadband universal by 2010.

10 July: Apple opens the App Store, with 500 mobile applications available.

28 July: Richard Branson reveals Virgin Galactic’s SpaceShipTwo in the Mojave desert, kicking off his plans for space tourism.

11 August: Georgia accuses Russia of launching a cyber warfare campaign to disrupt many of the country’s websites.

21 August: Havok offers a $40,000 prize for amateur games developers in a search for the next big thing in gaming.

3 September: A special issue of Nature focuses on big data and its implications for science.

28 September: On its fourth attempt, SpaceX’s Falcon 1 rocket celebrates a successful launch, becoming the first privately developed liquid-fuelled launch vehicle to achieve Earth orbit.

7 October: Spotify’s music streaming service is launched in Sweden, the UK, France, Germany, Italy, Spain, Finland and Norway.

15 October: PollDaddy, a Sligo company that enables websites to run polls, is acquired by Automattic, the parent company of WordPress.

22 October: The Indian Space Research Organisation launches its first lunar probe, Chandrayaan-1, which would go on to discover water on the moon.

4 November: Barack Obama is elected president of the US in a victory largely attributed to the Democratic senator’s online campaigning.

17 November: The specification for USB 3.0, which will be 10 times faster than USB 2.0, is complete.

22 December: A team of computer science researchers publish the paper ‘Big Data Computing: Creating revolutionary breakthroughs in commerce, science, and society’ outlining how big data will transform business, research, medicine and much more. It asserts that “big-data computing is perhaps the biggest innovation in computing in the last decade”.

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