On a Sunday afternoon in late August 2010, my friend Ryan and I bit off more than we could chew. Literally.
A 32 inch pizza with two sort-of-college-aged guys, you say? No problem. The rules of the challenge at Pop’s Pizza (RIP) were pretty simple; if two people could join forces and consume a 32 inch pizza in a certain amount of time, the pie was free and you’d be forever immortalized in the pantheon of great pizza challenge eaters. Very few teams actually accomplished this. We were not one of them…
Blissfully unaware of our own limitations as pizza consumers, Ryan and I entered that little arena on the corner at 938 Main Street in Quincy, Illinois and learned a thoroughly painful lesson. We are not Joey Chestnut caliber. The good news is we fed half the neighborhood when we returned to our apartment complex with what was left. Hats in hand. Egos destroyed. Stomachs aching. And pizza for days…
Something else that we were blissfully unaware of on that late August Sunday was what the heck Bitcoin was. But just 3 months before a giant pie at Pop’s Pizza humiliated us, down in Jacksonville, Florida a computer programmer named Laszlo Hanyecz orchestrated the first known bitcoin transaction for real goods when he spent 10,000 BTC for two Papa John’s Pizzas:
Those pies had a USD cost somewhere between $30-40. The anniversary of that sale has been celebrated within the Bitcoin community annually ever since. “Pizza Day,” as May 22nd has been dubbed, has become a real life “how it started, how it’s going” meme.
A lot of people on the sidelines have a hard time getting beyond the opportunity cost of the transaction. It makes for great headlines. At today’s price of $27,000 per BTC, the ten thousand coins that were exchanged for those pizzas have a current market value of $270 million. It’s probably easy to laugh at old Laszlo with the benefit of hindsight, but I think the more important story is his motivation for moving the coins.
In a 2018 interview with Coin Telegraph, he had no regrets:
I've always kind of just wanted people to use Bitcoin and buying the pizza was one way to do that. - Laszlo
He also acknowledged Bitcoin’s Lightning network and theorized that it would help enable adoption of Bitcoin as a payment rail network:
The Lighting Network is not perfect either, it has issues, it can be abused in various ways, but it's a step in that direction, and to me, if something like Lightning Network takes off, I think you're gonna see every online retailer just switch to it because nobody wants to use MasterCard, and Visa, and PayPal. - Laszlo
The cost to transact on Lightning is a small fraction of a penny. It’s far cheaper than the current payment processing services offered by companies like Visa, Mastercard, or PayPal. This is a potential motivation for merchant adoption that I hinted at earlier this monthCrypto Is a Circus Right Now
An extra dollar on $20 doesn’t seem like much in aggregate, but it amounts to a 5% vig just to process a transaction that costs a fraction of a penny on other networks. - Me
Lightning is one of those other networks. Back , Laszlo bought two pizzas with BTC again. This time though it was over the Lightning Network and for just a fraction of a bitcoin. Two pizzas for 0.00649 BTC to be exact.
As I’ve lamented in prior posts, Lightning has a long way to go. The spending capacity on that second layer is just $142 million and the BTC on that network actually started slightly declining a few weeks ago. It has declined in the past as well but the capacity level is still far closer to the highs than the lows when measured in BTC:
The opportunity for Lightning and other networks like it is crystal clear. This is especially true since we’re witnessing a global stablecoin market that has fallen over 30% since the collapse of Terra Luna last year:
The “killer app” of crypto doesn’t look so killer at the moment. That may have just as much to do with collateral fears than anything else. But the point should be obvious.
Tech is always evolving. Even reading back some of the comments in Laszlo Hanyecz’s original Bitcointalk post are hilarious 13 years later:
A lot of pizza places have online ordering - Laszlo
When Laszlo was trying to convince somebody to take the deal, he noted that the pizzas could be ordered with the internet. Something that is essentially universal today evidently had to be mentioned as an idea 13 years ago. Online ordering may not have been normal at the time, but it is now. I believe decentralized networks will eventually be looked at the same
For a long time I’ve felt the biggest challenge facing the industry isn’t onboarding big funds or getting approval from some unelected bureaucrats. No, the challenge has been making it simple enough for the masses. - Me
These things take time. I’ve certainly had to manage my own frustrations with utility and scaling. But these networks are inevitable and there is no putting web-based money back in the bottle. It’s here. We should use it.
I’ve mentioned things like in the past - that’s a lifestyle/play-to-earn app that uses Lightning for micropayments. Another way you can use Lightning is through an app called . It’s a podcasting app where users can earn bitcoin just for listening to the podcasts that they already enjoy. You can even listen to mine
Narrator: He’s shilling his podcast again.
13 years after the original Pizza Day, the anniversary is a great time to look back and see how far the network has come. It’s also a great reminder that these things are meant to be used. And we don’t need to ask for anyone’s permission. Thanks for leading by example, Laszlo.
Disclaimer: I’m not an investment advisor. Pineapple on pies is blasphemous. The best pizza topping combo is Pepperoni and Mushroom. Not up for debate.
