One of the biggest mysteries in the technology world is the identity of Satoshi Nakamoto, the computer programmer who invented the digital currency, Bitcoin. That’s because Satoshi Nakamoto is a pseudonym, it may be the name of one person or the name of a group, but for over 9 years now of Bitcoins existence, no one has figured out who or what Nakamoto really is.
Beyond solving a long-standing mystery, what sort of impact would uncovering Nakamoto’s identity actually have? To answer that, let’s start at the beginning. In 2008, Satoshi Nakamoto published a 9-page white paper containing the first ever mention of Bitcoin, calling it a peer-to-peer electronic cash system.
At this point, Bitcoin was just an idea on paper, but in 2009 Nakamoto put the concept to test, releasing the cryptocurrencies first software. Nakamoto was active those first few years, writing in forums, sending emails and working with other developers and coders to improve the program.
That all changed in 2011 when Nakamoto essentially vanished. No more forum entries, no more emails and in all of that time, nobody, not even close collaborators ever met the founder in person. But here’s the thing, whoever it is, they didn’t walk away empty-handed.
Nakamoto is estimated to have 1,000,000 Bitcoins which as of today is worth over $5 billion dollars. So why did Nakamoto just disappear?
Well, there are 2 competing theories, there’s the good Satoshi hypothesis:
- Which holds that Satoshi really wanted to let Bitcoin go and become its own thing without him.
- The other hypothesis is that Satoshi really just saw Bitcoin taking off and wanted to keep his privacy.
Investigators say the ladder, the “Bad Satoshi” hypothesis is more likely. As evidence, journalists are pointing their fingers at Dorian Nakamoto, a Japanese American who in 2014 was incorrectly identified as the inventor of Bitcoin.
Just a couple of years ago, News Week identified a man named Dorian Satoshi Nakamoto who isn’t Satoshi Nakamato, but they thought he was, and reporters descended upon his house and tore apart his life.
“I have nothing to do with Bitcoin, I just believe that somebody put that fictitious name out there.” – Dorian Nakamoto
I think there’s a pretty good case to be made about the last thing you want to do in your life is identified as the creator of Bitcoin. But for some people, being in the limelight is exactly what they want.
Take Craig Wright, he’s a former Australian academic who in 2016 told the BBC on camera that he could prove he was the founder of Bitcoin. It didn’t quite turn out that way.
Security researcher Dan Kaminsky included Wright’s claim was, “this is intentional scammery…”
For someone like Craig Steven Wright, it may have been beneficial in his mind to claim that authority. You’re able to speak at conferences and gather a lot of support.
So why do people keep searching?
It comes down to money and politics. Bitcoin has a finite supply. There are only 21 million that can ever be mined. Nakamoto is assumed to have 1,000,000 of them, which amounts to about 5% of the entire cryptocurrency.
So let’s put that into perspective. Take gold. The US government holds the most gold reserves than anyone in the world at about 8000 tons. The estimated total gold in the world is 187,000 tons. So the US has about 4.3% of the worlds total supply.
That means Nakamoto may have a bigger stake in Bitcoin than the entire US government has in gold. If Nakamoto were to unload those Bitcoins quickly, the value of the crypto could tank.
The thing about Bitcoin is if you control 1,000,000 of them, you have the ability to flood the market at any point. Think of them as rare baseball cards. They’re valuable because they’re rare. If someone could dump hundreds or thousands of Mickey Mantel trading cards, rare ones, onto the market, they wouldn’t be worth so much anymore.
So that’s kind of the danger with Satoshi.
Some people think the impact would be long-lasting. Ultimately, like every form of currency or money, Bitcoins value is predicated on its trust and Bitcoin has over been deemed trustworthy by a lot of people. There are about 3 billion dollars worth of value being traded every day and the market cap is over 200 billion, so even if Satoshi did crash the price with a few billion dollars of Bitcoin being sold, ultimately it would rebound back as the trust is already there from many other parties.
Then there is the influence Nakamoto could have on politics. So Bitcoin has been having a number of different political arguments between different factions, and a lot of these different factors have invoked Satoshi Nakamoto as their guiding figure.
They say Satoshi may have wanted this, or Satoshi may have wanted that. That’s easy to do because Satoshi is not there, and so we don’t actually know what Satoshi would have wanted.
I think the community may actually benefit if Satoshi did choose to come back and become a spiritual leader to provide guidance and reconcile the community towards consensus.
For now, though, it doesn’t seem that Satoshi Nakamoto is interested in coming forward. Anonymity provides protection, privacy, and peace. Three things that likely appear to the owner of 1,000,000 Bitcoins, but is that really such a bad thing?
With the havoc it could wreak on the price of Bitcoin and internal politics, it may be better off that Satoshi Nakamoto, whoever that is, remain anonymous and inactive indefinitely. But that won’t stop people from wondering.