Who is Satoshi Nakamoto? This is one of the most important and unanswered questions in the crypto sphere. Many people and organizations have been linked to who Nakamoto is but with no success. What is known so far is that Satoshi Nakamoto is the name given to the person, group of people or entity who created Bitcoin and its underlying blockchain technology.
Nakamoto’s name has Japanese attributes attached to it and this one of the reasons why Nakamoto is believed to be from Japan. However, judging by the perfect English used in Nakamoto’s forum posts and the Bitcoin white paper, Satoshi may be from the U.S. or the Commonwealth region.
According to Satoshi’s P2P Foundation profile, Nakamoto is a Japanese man born on April 5, 1978. By all means, Satoshi Nakamoto is the mysterious creator of Bitcoin and the ‘unknown father of cryptocurrencies.’
Development of Bitcoin
Nakamoto published a white paper entitled “Bitcoin: A Peer-to-Peer Electronic Cash System” which describes Bitcoin, the world’s first cryptocurrency. The white paper was released on a cryptography mailing list in October 2008.
The Bitcoin network went live in January 2009 and the first bitcoin units (cryptocurrency) were mined and sent to Hal Finney. After mining the genesis block, Nakamoto embedded the following text:
“The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”
Nakamoto claimed that he started working on the Bitcoin project in 2007 and he continued making changes to the Bitcoin software until 2010 when he handed over the reins to Gavin Andresen before disappearing from the surface of the earth and the digital space.
According to Nakamoto’s known addresses from publicly available transaction logs, Satoshi has a stake of nearly 1 million bitcoins – which have remained unspent for a very long time.
Nakamoto’s stake surpassed $19 billion when bitcoin reached its peak price in December 2017.
Nakamoto was meticulous in hiding his/her/their identity from the onset. Nakamoto wrote on fractional-reserve banking, meaning that Satoshi is or was good in both economics and computer programming. Some have speculated that creating Bitcoin is the work of more than one person. Others say that Bitcoin was created by government agencies such as the U.S. National Security Agency (NSA) or the Central Intelligence Agency (CIA).
It is also important to note why Nakamoto’s identity was hidden and these are some of the reasons that have been thrown in the hat.
Creating a truly decentralized community
Since Nakamoto was trying to create a truly decentralized monetary system that heavily differed from fiat currencies controlled by governments and central banks, Satoshi wanted to make sure that he/she/they did not have a direct influence in the network.
Being known would have made Satoshi the leader of the bitcoin network. Satoshi’s decisions or announcements would have affected the price of bitcoin – defying the core purpose of bitcoin.
This is probably one of the reasons why Charlie Lee, the creator of the altcoin Litecoin decided to sell all of his LTC holdings. It’s because he had control of LTC’s price movements.
Staying under the radar
Creating such a system would have undoubtedly attracted the long arm of authorities. Bernard Von NotHaus, a Hawaii resident developed an alternative currency in 1998. It was in circulation for a short while before the authorities stepped in and halted the minting of the coins.
The U.S. Secret Service and the FBI raided NotHaus in 2007. He was found guilty in 2009 of creating a competing currency against the legal tender.
Nakamoto was probably aware that bitcoin had the potential to be used for both legal and illegal uses. A well-known example is the Silk Road darknet marketplace. The marketplace allowed people to buy and sell drugs, weapons, and other illicit goods using bitcoin.
The operator of the darknet marketplace Ross Ulbricht was arrested, his website shut down, and sentenced to life in prison. While this happened after the Bitcoin network was created, Satoshi may have wanted to avoid being in similar situations.
A true disciple of the cypherpunk community
Satoshi’s history with anonymity began long before the invention of Bitcoin. Nakamoto was a member of the cypherpunk community and the identity of the Bitcoin creator was still a mystery back then.
It is possible that Satoshi is a true disciple of the cypherpunk community who strictly adheres to the cypherpunk manifesto.
“Privacy is the power to selectively reveal oneself to the world,” reads part of the cypherpunk manifesto written by Eric Hughes.
Potential identities of Satoshi Nakamoto
While Satoshi’s identity remains a mystery, there are some people who have been linked to the Bitcoin creator as a result of their work in cryptography, computer science, or early communication with Nakamoto.
Here are some people who have been linked to Nakamoto.
A Japanese-American man living in tech hub California was identified as Satoshi Nakamoto partly due to his name. Born as Dorian Prentice Satoshi Nakamoto, Dorian was identified by the journalist Leah McGrath Goodman as the mysterious Bitcoin inventor.
Dorian appeared in a Reddit AMA and refuted the allegations. On the same day, Nakamoto’s P2P Foundation account sent a message for the first time in almost half a decade stating that the bitcoin creator was not Dorian. The post was not taken seriously as it was generally believed that Nakamoto’s P2P Foundation account was hacked.
Hal Finney, who passed away in August 2014, was also believed to be Nakamoto because of several reasons. He was the second person (after Satoshi) to use the Bitcoin software, make improvements, and file bug reports.
Moreover, Finney lived very close to Dorian Nakamoto’s family home, suggesting that he used Nakamoto’s name to hide his own identity. He was the first person to receive bitcoins from Satoshi.
Just like Nakamoto, he was a cypherpunk and was quoted saying, “The computer can be used as a tool to liberate and protect people, rather than to control them.”
Prior to the invention of Bitcoin, Finney created the world’s first reusable proof-of-work system in 2004. He was paralyzed going into the final days of his life but he never stopped programming.
Nick Szabo – a cryptographer, legal scholar, computer scientist, and the brains behind bit gold (a digital currency lauded as the precursor to bitcoin) – has also been linked to Satoshi Nakamoto. He denies these claims.
Wei Dai is a very private computer scientist known for creating the Crypto++ library and b-money, Bitcoin’s predecessor. The main concepts in b-money are used in Bitcoin.
Dai and Adam Back are the first two people that Nakamoto was in contact with during the creation of Bitcoin.
“Myself, Wei Dai, and Hal Finney were the only people I know of who liked the idea (or in Dai’s case his related idea) enough to pursue it to any significant extent until Nakamoto (assuming Nakamoto is not really Finney or Dai),” said Szabo in an article in May 2011.
Craig Wright is a Bitcoin proponent who has tried several times but unsuccessfully to convince the world that he is Nakamoto. He has been told by the crypto universe that the only way to prove that he is the real Satoshi is if he can spend the Bitcoins stored on Satoshi’s known wallet addresses.
Wright is the main supporter of Bitcoin SV (Satoshi Vision), a product of the controversial November 2017 Bitcoin Cash hard fork.
Bitcoin SV was delisted from cryptocurrency exchange Binance in 2019 because the trading platform’s founder, Changpeng Zhao, was fed up with Wright’s claims that he is the mysterious Satoshi Nakamoto.
Will Satoshi’s identity ever be revealed
It will be quite a while before Satoshi’s identity is revealed.
It is possible that Nakamoto may be dead by now or is a large organization benefiting from Nakamoto’s mystery. The only way to put the matter to bed is if someone can transfer the stake lying in Satoshi’s wallets. John McAfee, an eccentric figure in the crypto space, claims to know the true identity and location of Nakamoto. He had initially promised to reveal who Satoshi is but has decided against it.
For now, Satoshi continues to be the stuff of mystery and legend.