If you’ve heard anything about Bitcoin—or anything about cryptocurrencies at all, for that matter—it’s likely you’ve also encountered the name Satoshi Nakamoto. Nakamoto is famously known as the inventor of Bitcoin, but beyond that initial fact there are many mysteries surrounding Nakamoto’s identity. For one thing, no one knows for certain exactly who Satoshi Nakamoto is, because the name is a pseudonym. Indeed, there are many potential candidates who could be Nakamoto, and it’s also possible that Satoshi Nakamoto does not refer to a single person at all, but rather to a group of people or even an organization. Whoever or whatever Satoshi Nakamoto is, at the current price of BTC he or they would almost certainly be a billionaire. This makes the mystery all the more intriguing.
Summary for Fast Readers
- Satoshi Nakamoto is the pseudonym used by the person (or people) who launched Bitcoin.
- While no one knows exactly who the creator of Bitcoin really is, several potential cryptographers and developers have emerged as potential candidates for the person behind the name Satoshi Nakamoto.
- Nakamoto presented the concept for Bitcoin in a whitepaper in 2008, launched the network in 2009, and disappeared from the Bitcoin community by 2010.
- It is estimated that Nakamoto’s Bitcoin holdings are at least 1 million coins, worth more than $50 billion today.
History of Satoshi Nakamoto
Why Did Satoshi Nakamoto Create Bitcoin?
While the invention of Bitcoin has undoubtedly generated massive wealth for Nakamoto, it seems unlikely that this was Nakamoto’s primary aim in creating Bitcoin. Bitcoin was not the first attempt at a cryptocurrency: earlier examples like B-Money and Bit Gold predate Bitcoin and were steps in the cryptography community’s work toward the development of cryptos as we know them today.
While Nakamoto did not create the concept of cryptocurrencies out of thin air, he (or they) did solve a major problem that had previously plagued the emerging field. A major concern for digital currencies is the so-called double-spending problem. Put simply, when a physical dollar bill is spent, ownership of that bill transfers from one person to another. There is no way that the first owner could spend the same bill a second time, because he no longer has it in his possession. Digital currencies do potentially have this issue, though, because there is nothing physically transferred from one person to the next in the transaction. Prior to Bitcoin, the most common way around the double-spending problem for cryptocurrency developers was to enlist a trusted third-party arbitrator.
Nakamoto presented an alternative. Rather than rely on a third party, Bitcoin would utilize a peer-to-peer network which would be decentralized and trustless, meaning that it does not require a central authority to mediate transactions or disputes. This has provided the foundation of many key distinguishing elements of Bitcoin: the anonymity of Bitcoin transactions, the use of blockchain technology, and many other aspects.
Satoshi’s Whitepaper for Bitcoin
Nakamoto laid out the model for Bitcoin in an important document called a whitepaper. “Bitcoin: A Peer-to-Peer Electronic Cash System” is a 9-page document that details the fundamental motivations for the development of the cryptocurrency as well as the basic structure of transactions, the proof-of-work model, the Bitcoin network, and similar elements.
How Satoshi Created Bitcoin
Satoshi Nakamoto created the first Bitcoin in much the same way that new Bitcoins are created more than 10 years later: by mining a block. In early January 2009, Nakamoto launched the Bitcoin software and the network by mining what is known as the genesis block. As is the case with all blocks mined in the Bitcoin ecosystem, there was a reward paid out in new BTC added into circulation. This block famously includes in its code a reference to a newspaper headline from The Times from the U.K. which mentions a bank bailout. This has been interpreted in various ways in the years since Bitcoin launched, including as a hint about Satoshi’s identity and, perhaps more commonly, as a statement against traditional banking and monetary models. Satoshi was subsequently involved with maintaining and growing the Bitcoin network for the remainder of 2009 and into 2010. In 2010, though, Nakamoto mysteriously disappeared from the growing Bitcoin community, indicating in an email to a fellow developer that he or they had moved on to other things.
People and Organizations That Could Potentially Be Satoshi Nakamoto
While we may never know for sure, there are several individuals and groups that are commonly offered as possible real-life identities of Satoshi Nakamoto. The names below are some of the most widely suggested, but this is by no means a comprehensive list.
Of all potential Nakamoto candidates, Hal Finney may be the most likely. Finney, who passed away in 2014, was a cryptographer and the second person after Nakamoto to use Bitcoin software. Some crypto enthusiasts have argued that Finney’s writing style is closest of all the major candidates to the email records of Satoshi Nakamoto. However, this may mean that Finney is Nakamoto, it may mean that he ghostwrote for his friend and early collaborator, or it may be a coincidence. Finney also lived a few blocks away from a real-life person whose name may have inspired the pseudonym Satoshi Nakamoto.
The person who lived close by to Hal Finney was Dorian Nakamoto, born with the given name Satoshi. Besides his name, there are other aspects of Dorian Nakamoto’s life and story which some feel points to him as the true identity behind the pseudonymous Nakamoto. For instance, Dorian Nakamoto has had a career in computer engineering and classified defense projects, a political history of libertarianism, and he even may have mistakenly tied himself to the Bitcoin project in a statement given in an interview for a 2014 report. Dorian Nakamoto subsequently clarified and denied all connection to Bitcoin.
Nick Szabo was a key figure in the development of Bit Gold, one of the digital currency precursors to Bitcoin. Szabo was also in communication with Finney and other early Bitcoin adopters. This history, combined with his interest in decentralized currencies, points to his potential as the person behind the name Satoshi Nakamoto. He has also denied this.
Many crypto enthusiasts feel that Craig Wright has been debunked as a potential candidate for the identity of Satoshi Nakamoto at this point. However, Wright, an Australian businessman and academic, made headlines in 2015 as he tried to convince the cryptocurrency community that he was Nakamoto. He even has gone so far as to attempt to sue people who have denied that he is Nakamoto.
How Many Bitcoins Does Satoshi Nakamoto Have?
While it’s not clear exactly how many Bitcoins Satoshi Nakamoto has, estimates place Nakamoto’s holdings at more than 1,000,000 BTC. At current prices, this would make Nakamoto’s Bitcoin fortune worth well over $50 billion.
Satoshi Nakamoto is one of the most famous names in the cryptocurrency world, as well as one of the most mysterious. Nakamoto is the pseudonym used by the developer(s) of Bitcoin. Nakamoto solved the double-spending problem by proposing a peer-to-peer network which allows for a decentralized, trustless ecosystem that has served as the foundation for Bitcoin and countless other cryptocurrencies. As the person or entity that launched Bitcoin, Nakamoto is estimated to have mined more than 1,000,000 BTC, worth upwards of $50 billion today. However, in 2010, Nakamoto famously disappeared from the Bitcoin community, and cryptocurrency enthusiasts have been working to solve the mystery of his identity ever since.