Decoding Satoshi Nakamoto 1

DECODING SATOSHI NAKAMOTO

REES CLANCY

I’VE MOVED ONTO OTHER THINGS

January 3rd 2009 — Satoshi Nakamoto mined the very first bitcoin. Which was fitting, given that Satoshi is to Bitcoin as Alexander Graham Bell was to the telephone. The inventor had revealed the creation to a tiny online community of cryptography-obsessed computer scientists and hackers two months earlier. In that scene, Satoshi was already a familiar name, if not a real one. Years before the world heard a peep about Bitcoin, someone using the Satoshi Nakamoto pseudonym had been posting to message boards and emailing fellow developers, never identifying a location, a nationality, or even a real name. Nakamoto released Bitcoin and saw it begin to catch on, and then, in April 2011, sent an email to a developer friend saying ‘I’ve moved on to other things.’

After that? Satoshi Nakamoto disappeared into thin air.

CONTENTS

The Digital Age’s Biggest Mystery

The Cypherpunks

Bitcoin is Born

Dorian Nakamoto

Hal Finney

Nick Szabo

Wei Dai

Adam Back

Shinichi Mochizuki

Craig Wright

Dave Klieman

Paul le Roux

Len Sassaman

THE DIGITAL AGE’S BIGGEST MYSTERY

The question of the real identity of Bitcoin’s creator is one of the greatest modern mysteries. Who was Satoshi Nakamoto? Why that name? And where did Satoshi go? Beyond having invented an entirely new kind of money that has gone on to achieve a market cap of more than $1 trillion, Satoshi Nakamoto is widely believed to hold more than a million bitcoin, which would be worth over $49 billion at the time of writing. If Satoshi left clues, they can be found in the code and messages the crypto inventor wrote between 2008 to 2011. The entire output, numbering just a few hundred total messages that mostly consist of posts to a forum he created called BitcoinTalk in 2009, has been meticulously catalogued like a sacred text.

At this point, millions of people have pored over Satoshi’s words, but when they were first written they were mostly read by a few dozen members of the Cryptography Mailing List, made up of programmers who specialize in inventing techniques for secure communication. Many on the mailing list identified as cypherpunks who advocated for the use of cryptography to bring about social and political change.Bitcoin was initially greeted with a collective yawn, as recalled by legendary cryptographer Hal Finney, the first person to ever receive bitcoin from Satoshi.

Satoshi’s October 2008 announcement, a whitepaper outlining the mechanics of Bitcoin, didn’t have the bombastic tone you’d expect from someone who understood he was about to change the world. ‘I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party,’ Satoshi wrote matter of factly. But the nine-page, equation-filled treatise did introduce a solution to a knotty problem that had bedevilled the cypherpunk community for years. No prior digital money concept had cracked what Satoshi referred to as the ‘double-spending problem.’ How can you prevent a currency with no physical form from being duplicated like any other computer file and spent over and over, the way kids shared endless copies of Eminem mp3s via Napster earlier in the 2000s?

A peer-to-peer system would eliminate the need for any kind of central authority (like a credit card company or a bank) to validate transactions. The need for central authorities, Satoshi reasoned, was the failure point for earlier attempts at digital currencies.

Feb 15th 2009, 04:42:00 PM

A lot of people automatically dismiss e-currency as a lost cause because of all the companies that failed since the 1990’s. I hope it’s obvious it was only the centrally controlled nature of those systems that doomed them. I think this is the first time we’re trying a decentralized, nontrust-based system.

Satoshi Nakamoto

To accomplish this ‘trustless’ system, Satoshi proposed a publicly available shared ledger that would document every transaction. He called it the blockchain. Bitcoin’s independence from the existing financial system was an idea that must have been particularly appealing at the time, given that Satoshi had just witnessed the global financial system melt down over vastly irresponsible bets made by big investment banks.

In the ‘trust-based mode’ of internet commerce, third parties like payment processors reap rewards for acting as an intermediary. Bitcoin could make the intermediaries obsolete. And by 2010, the idea had attracted conside able attention outside the insular cryptography scene. Journalists, hackers, and intelligence agencies have all scrutinized the breadcrumbs Satoshi left behind in the hopes of divining the Bitcoin inventor’s identity. Though Satoshi pointedly never shared any personal details in his communications, he did once describe himself (in a profile on a peer-to-peer forum) as a 37-year-old man living in Japan, a fact that pretty much nobody believes. So where was he actually from?

We don’t know where Satoshi Nakamoto came from or where they are now. We don’t know if Satoshi Nakamoto was male or female, they’re referred to as male because that’s what his P2P Foundation profile claimed. We don’t know if Satoshi Nakamoto was a single person or a group of people. If Satoshi is indeed only one person, he belongs to a very specialized group of programmers that probably numbers in the dozens.

There are those who are convinced that Satoshi isn’t in fact one person at all, but rather a team of programmers, perhaps even including someone working inside the NSA. ‘He’s a world-class programmer, with a deep understanding of the C++ programming language,’ Dan Kaminsky, one of the world’s top Internet security researchers, told The New Yorker in 2011. ‘He understands economics, cryptography, and peer-to-peer networking.’

Kaminsky’s conclusion? ‘Either there’s a team of people who worked on this or this guy is a genius.’

Naturally, a wide variety of characters have claimed to be Satoshi. There is Jörg Molt, a German ex-DJ with Las Vegas-magician hair who has marketed himself as ‘cofounder of Bitcoin’ to sell, among other things, a Bitcoin-branded sparkling wine. And Australian Craig Steven Wright, who according to a 2019 Wired article, ‘either invented bitcoin or is a brilliant hoaxer who very badly wants us to believe he did.’

If Satoshi is indeed only one person, he belongs to a very specialized group of programmers that probably numbers in the dozens.

Jörg Molt is a German entrepreneur who claims to be the co-founder of Bitcoin. There‘s no evidence to back up these claims.

thriveglobal.com

BANKS MUST TRUSTED OUR MONEY TRANSFER

MUST BE TO HOLD MONEY AND TRANSFER IT ELECTRONICALLY

BUT THEY OUT IN WAVES

CREDIT BUBBLES BARELY A IN RESERVE

- Satoshi Nakamoto

LEND IT WAVES OF BUBBLES WITH FRACTION RESERVE

Nakamoto

THE CYPHERPUNKS

Long before Facebook, long before the Great Firewall of China, long before the Snowden revelations, the cypherpunks saw it coming. They foretold a regime of online censorship that would eclipse the open Internet. And according to the cypherpunks, there was only one tool that could ensure the Internet’s freedom: cryptography.

Cryptography is the maths of codes and code breaking. Prior to the 1970s, cryptography was a relatively arcane field, practiced only by the military and by spy agencies. At the time, strong encryption (anything more than 40 bits of security) was considered to be a military munition and therefore illegal to export from the US.

In late 1992, three individuals (Eric Hughes, a mathematician from University of California, Tim May, a retired businessman who worked for Intel, and John Gilmore, a computer scientist who was Sunmicrosystems’ fifth employee) who had all retired young, invited twenty of their closest friends to an informal meeting to discuss some of the world’s seemingly most vexing programming and cryptographic issues.

Privacy and personal liberty were ultimately placed above all other considerations

That initial meeting eventually evolved into a monthly meeting held at John Gilmore’s company, Cygnus Solutions. At one of the first meetings, Jude Milhon (a hacker and author better known by her pseudonym St. Jude) described the group as the ‘Cypherpunks’. A combination of the word ‘cipher’ or ‘cypher’, one of the ways to perform encryption and decryption, and cyberpunk, a genre of fiction made popular by sci-fi writers.

From those humble beginnings, an entire movement evolved. As the group grew it was decided that setting up a mailing list would allow them to reach other ‘Cypherpunks’ outside of the bay area. The mailing list grew in popularity fairly quickly and included hundreds of subscribers who were exchanging ideas, discussing developments, proposing and testing cyphers on a daily basis. These exchanges took place through the use of novel encryption methods, such as PGP, to ensure complete privacy. As a result, ideas were shared freely.

This privacy and freedom resulted in free flowing discussions on wide ranging topics from technical ideas such as mathematics, cryptography and computer science to political and philosophical debates. Although there was never complete agreement on any one thing, this was an open forum where personal privacy and personal liberty were ultimately placed above all other considerations.

The basic ideas behind this movement can be found in the Cypherpunk manifesto written by Eric Hughes in 1993. The key principle which underpins the manifesto is the importance of privacy. One can see this and other principles discussed in the manifesto being used to build the ideas that lead to the creation of Bitcoin.

From left to right: Tim May, Eric Hughes and John Gilmore. bit2meacademy

The cypherpunks shared a core conviction: the Internet would soon become an important battleground for human freedom.

ERIC HUGHES 1993 A CYPHERPUNK’S MANIFESTO

Privacy is necessary for an open society in the electronic age. Privacy is not secrecy. A private matter is something one doesn’t want the whole world to know, but a secret matter is something one doesn’t want anybody to know. Privacy is the power to selectively reveal oneself to the world.

If two parties have some sort of dealings, then each has a memory of their interaction. Each party can speak about their own memory of this; how could anyone prevent it? One could pass laws against it, but the freedom of speech, even more than privacy, is fundamental to an open society; we seek not to restrict any speech at all. If many parties speak together in the same forum, each can speak to all the others and aggregate together knowledge about individuals and other parties. The power of electronic communications has enabled such group speech, and it will not go away merely because we might want it to.

Since we desire privacy, we must ensure that each party to a transaction have knowledge only of that which is directly necessary for that transaction. Since any information can be spoken of, we must ensure that we reveal as little as possible. In most cases personal identity is not salient. When I purchase a magazine at a store and hand cash to the clerk, there is no need to know who I am. When I ask my electronic mail provider to send and receive messages, my provider need not know to whom I am speaking or what I am saying or what others are saying to me; my provider only need know how to get the message there and how much I owe them in fees. When my identity is revealed by the underlying mechanism of the transaction, I have no privacy. I cannot here selectively reveal myself; I must always reveal myself.

Therefore, privacy in an open society requires anonymous transaction systems. Until now, cash has been the primary such system. An anonymous transaction system is not a secret transaction system. An anonymous system empowers individuals to reveal their identity when desired and only when desired; this is the essence of privacy.

Privacy in an open society also requires cryptography. If I say something, I want it heard only by those for whom I intend it. If the content of my speech is available to the world, I have no privacy. To encrypt is to indicate the desire for privacy, and to encrypt with weak cryptography is to indicate not too much desire for privacy. Furthermore, to reveal one’s identity with assurance when the default is anonymity requires the cryptographic signature.

We cannot expect governments, corporations, or other large, faceless organizations to grant us privacy out of their beneficence. It is to their advantage to speak of us, and we should expect that they will speak. To try to prevent their speech is to fight against the realities of information. Information does not just want to be free, it longs to be free. Information expands to fill the available storage space. Information is Rumor’s younger, stronger cousin; Information is fleeter of foot, has more eyes, knows more, and understands less than Rumor.

We must defend our own privacy if we expect to have any. We must come together and create systems which allow anonymous transactions to take place. People have been defending their own privacy for centuries with whispers, darkness, envelopes, closed doors, secret handshakes, and couriers. The technologies of the past did not allow for strong privacy, but electronic technologies do.

We the Cypherpunks are dedicated to building anonymous systems. We are defending our privacy with cryptography, with anonymous mail forwarding systems, with digital signatures, and with electronic money.

Cypherpunks write code. We know that someone has to write software to defend privacy, and since we can’t get privacy unless we all do, we’re going to write it. We publish our code so that our fellow Cypherpunks may practice and play with it. Our code is free for all to use, worldwide. We don’t much care if you don’t approve of the software we write. We know that software can’t be destroyed and that a widely dispersed system can’t be shut down.

Cypherpunks deplore regulations on cryptography, for encryption is fundamentally a private act. The act of encryption, in fact, removes information from the public realm. Even laws against cryptography reach only so far as a nation’s border and the arm of its violence. Cryptography will ineluctably spread over the whole globe, and with it the anonymous transactions systems that it makes possible.

For privacy to be widespread it must be part of a social contract. People must come and together deploy these systems for the common good. Privacy only extends so far as the cooperation of one’s fellows in society. We the Cypherpunks seek your questions and your concerns and hope we may engage you so that we do not deceive ourselves. We will not, however, be moved out of our course because some may disagree with our goals.

The Cypherpunks are actively engaged in making the networks safer for privacy. Let us proceed together apace. Onward.

Eric Hughes <hughes@soda.berkeley.edu>

9 March 1993

An early cypherpunk named Adam Back made his email signature the RSA encryption algorithm, written in five lines of Perl. Due to restrictions on the export of encryption algorithms, this was an illegal act of civil disobedience. He encouraged others on the mailing list to copy it in in solidarity.

Over time, the combination of legal victories by people like Peter Junger, Phil Zimmerman, and Daniel Bernstein, the development of SSL and HTTPS by companies like Netscape, the practical availability of encryption software outside the US, and the degree to which lack of encryption was hampering e-commerce ended up winning the argument. Internet advocates won the First Crypto Wars, as export controls on encryption were liberalised.

But the cypherpunks knew that encryption alone would not be enough to liberate cyberspace. To build a truly free digital commons, you needed a completely sovereign economy. In other words, you needed a digitally native form of money.

In 1990, David Chaum spearheaded the first serious attempt at building private digital money. DigiCash used novel cryptography to ensure user privacy while solving the double spend problem. The underlying algorithm was known as eCash, first published in 1982 and later improved by other cryptographers.

Chaumian eCash was a major leap forward in digital currencies. But in 1998, the company founded on eCash (DigiCash) went bankrupt. It ultimately lost out in user adoption against credit cards and less private payments systems like PayPal. And of course, when the company liquidated, its entire cash ecosystem evaporated.

The cypherpunks saw this failure and realized that Chaumian eCash had another weakness that had previously gone under appreciated: it relied on a single company. If digital cash were to flourish, it would have to grow beyond dependence on any central party.

It would have to become decentralized.

The cypherpunks believed that the soundest economic system was one that no one could manipulate.

The DigiCash team in 1995 chaum.com

DigiCash was not the only attempt at creating a digital currency. The cypherpunks launched many experiments, including Mojo Nation, a payments system for incentivized file sharing, and Hashcash, a ‘payments’ scheme for mitigating email spam.

But the cypherpunks weren’t the only ones trying to create digital currencies. Founded in 1996, e-gold was one of the first dotcom companies to create a digital currency, two years before PayPal.

e-gold issued a digital currency backed by gold reserves that anyone could hold and transfer. At its height, e-gold processed more than $2B in transfers a year. It was immensely popular, but because it had few restrictions on sign up, the currency was widely co-opted by hackers, scammers, and organised cybercriminals.

The US government took notice. After a lengthy court case, a court ruled e-gold guilty of money laundering and retroactive violations of money transmitter laws. The founder was found criminally liable, and in 2008, all e-gold balances were frozen. Over the next five years, the US government would manage redemptions of all e-gold account holders.

To the cypherpunks, e-gold demonstrated yet another important lesson: regulators did not want digital cash to exist.

e-gold CEO Douglas Jackson was sentenced to 300 hours of community service, a $200 fine and three years of supervision, including six months of electronically monitored home detention. Wired

While e-gold was collateralized with gold, DigiCash was collateralised with US dollars. But both ultimately fell within the purview of the state. If you wanted to create a currency that was beyond state control, it seemed that every form of collateral came with a centralization chokepoint.

So maybe, the cypherpunks thought, they should avoid collateral altogether. Was it possible to create a non collateralised form of money? The US dollar managed to pull it off after Bretton Woods and left behind the gold standard.

But if you had a non collateralised form of money, you also somehow needed to enforce scarcity. Every form of money in the past, whether shells, gold, or US dollars, had some method of ensuring that the money supply didn't inflate out of control.

The cypherpunks explored several schemes for non collateralised digital currencies. The first attempt at such an anonymous transacting system was made by Dr. Adam Back in 1997 when he created Hashcash. At its essence, this was an anti-spam mechanism which would add a time and computational power cost to sending email, therefore making the sending of spam uneconomical. A sender would have to prove that they had expended computational power to create a stamp in the header of an email (similar to the proof of work use in Bitcoin) before they were able to send it.

Various people from across the world have been working tirelessly on the blockchain technology and crypto currencies since the 1990’s and there have been multiple attempts to solve the complex issues surrounding cryptocurrency, by arguably some of the most brilliant minds in this space.

Two of the most important schemes were b-money, described by Wei Dai in 1998, and BitGold, described by Nick Szabo in 2005. Both schemes were designed by prominent cypherpunks and were strikingly similar to Bitcoin, but they were both missing key ingredients. We know that Satoshi was aware of b-money and he cited it in his whitepaper, and he later added an acknowledgement to BitGold on the Bitcoin website.

At the end of the day, b-money and BitGold were only described in blog posts, so they were relatively underspecified. They both would have required significant changes to be workable protocols and neither had working code. As such, they mostly traded in the arena of theoretical proposals. But these two designs would ultimately influence the digital currency that would see the light of day, Bitcoin.

Every form of money in the past, whether shells, gold, or US dollars, had some method of ensuring that the money supply didn’t inflate out of control.

BITCOIN IS BORN

According to legend, Satoshi began working on the Bitcoin project sometime during 2007.

August 18th 2008 - The bitcoin.org domain was registered from a Russian IP address using anonymousspeech.com, suggesting that Satoshi desired to hide his or her identity from their very first interaction with the world.

October 31st 2008 - Satoshi Nakamoto published the Bitcoin whitepaper to the Cryptography Mailing List. The service used was a pipermail message service hosted on metzdowd.com run by a group of cypherpunks. The Bitcoin whitepaper announcement wasn’t a huge deal at the time and really only a small number of people witnessed the message and replied. So three days later on November 3 2008, he decided to write the mailing list again pitching the newly published paper. The Bitcoin inventor mentioned some of the same things that were said in the previous message published on Halloween. A few people had replied to Satoshi at the time and one individual seemed to like the idea, but he didn’t think Bitcoin could scale.

Satoshi Nakamoto

Oct 31st 2008, 14:10:00 PM

metzdowd.com mailing list

The paper is available at:

http://www.bitcoin.org/bitcoin.pdf

Satoshi Nakamoto

The Cryptography Mailing List Unsubscribe by sending “unsubscribe cryptography” to majordomo at metzdowd.com

I've been working on a new electronic cash system that's fully peer-to-peer, with no trusted third party.

November 9th 2008 - The Bitcoin project was registered on SourceForge.net, a community collaboration website focused on the development and distribution of open source software.

January 3rd 2009 - Block 0, the genesis block, was established at 18:15:05 GMT. The block is unique because it has a 50 BTC reward subsidy that can never be spent. Alternative coins that have copied Bitcoin’s framework also use a hardcoded block to start a new chain. In addition to this characteristic, block zero reads the following message in the coinbase parameter, which hints at a possible reminder of why the cryptocurrency was created. ‘The Times 03/Jan/2009 Chancellor on brink of second bailout for banks’.

January 9th 2009 - Version 0.1 of Bitcoin was released online. Compiled with Microsoft Visual Studio, it was so complete that it furthers speculation that it was developed by more than one person. It includes a Bitcoin generation system that would create a total of 21 million coins through the year 2040.

January 12th 2009 - The first transaction ever sent on the Bitcoin blockchain was from the cryptocurrency’s pseudonymous creator to long-time cryptographer and cypherpunk Hal Finney. It was made as a test and, according to Finney himself, what followed was an email conversation in which the cypherpunk described bugs to Satoshi so they could fix them.

October 5th 2009 - New Liberty Standard published an exchange rate that establishes the value of a Bitcoin at US $1 = 1,309.03 BTC, using an equation that includes the cost of electricity to run a computer that generated coins.

February 6th 2010 - The Bitcoin Market was established by dwdollar as a Bitcoin currency exchange. Nakamoto continued to work on the Bitcoin project alongside close collaborators like Hal Finney.

Hal

March 19th 2013, 20:40:02 PM

bitcointalk.org

When Satoshi announced the first release of the software, I grabbed it right away. I think I was the first person besides Satoshi to run bitcoin. I mined block 70-something, and I was the recipient of the first bitcoin transaction, when Satoshi sent ten coins to me as a test. I carried on an email conversation with Satoshi over the next few days, mostly me reporting bugs and him fixing them.

The small band of early bitcoiners all shared the communitarian spirit of an open source software project.

The genesis block’s coinbase parameter message implies that Satoshi put it there as more than a simple time stamp.

Chancellor on brink of second bailout for banks

May 22nd 2010 - The first real world transaction using Bitcoin took place when programmer Laszlo Hanyecz offered to pay 10,000 coins for a pizza on the Bitcoin Forum. At the time, the exchange rate put the purchase price for the pizza at around $41 USD. Despite the offer, many of the respondents were initially unable to make the exchange, which led to Laszlo having to wait four days to make the purchase before another user on the forum, Jercos, accepted the offer.

To commemorate the transaction, the 22nd of May is dubbed Bitcoin Pizza Day, and pizza providers world wide offer discounts to Bitcoin users to commemorate Laszlo’s purchase. With one bitcoin now worth roughly $50,000, the day is a joke in the Bitcoin community, using Hanyecz’s $500 million pizzas as the punchline.

Laszlo

May 18th 2010, 12:35:20 AM

bitcointalk.org

I’ll pay 10,000 bitcoins for a couple of pizzas. like maybe 2 large ones so I have some left over for the next day. I like having left over pizza to nibble on later. You can make the pizza yourself and bring it to my house or order it for me from a delivery place, but what I’m aiming for is getting food delivered in exchange for bitcoins where I don’t have to order or prepare it myself, kind of like ordering a ‘breakfast platter’ at a hotel or something, they just bring you something to eat and you’re happy!

I like things like onions, peppers, sausage, mushrooms, tomatoes, pepperoni, etc. just standard stuff no weird fish topping or anything like that. I also like regular cheese pizzas which may be cheaper to prepare or otherwise acquire.

If you’re interested please let me know and we can work out a deal.

Thanks, Laszlo

Laszlo Hanyecz didn’t expect to make history when he ordered two large pizzas from Papa John’s in May 2010.

Celebrating his success, Lazlo shared photos of the infamous pizza with other members of the bitcointalk.org forum.

heliacal.net

July 17th 2010 - The MtGox Bitcoin currency exchange market was established by Jed McCaleb, letting people buy and sell bitcoin using bank transfers. MtGox filed for bankruptcy in 2014 after clients complained that they couldn’t withdraw their bitcoin. Its failure could have been catastrophic. MtGox was responsible, by some estimates, for 70 percent of all bitcoin ever traded at the time.

December 5th 2010 - Since Bitcoin’s launch the year before, it was largely unknown outside of the Cypherpunk community. The first hint of a mainstream moment came when the whistleblowing organisation WikiLeaks began to accept donations in Bitcoin after being removed from other payment platforms. In late 2010 WikiLeaks was a prime target for the US government, and anyone providing services became directly associated with them.

PC World ran an article on the WikiLeaks move, leading Satoshi Nakamoto to compose a now famous post on the BitcoinTalk forum. ‘WikiLeaks has kicked the hornet’s nest, and the swarm is headed towards us’. Nakamoto made it clear that they had fears of Bitcoin gaining popularity too early on. They’d make their final public forum post the following day.

December 12th 2010 - The Financial Action Task Force, an inter-governmental group that develops and promotes policies preventing money laundering and funding of terrorists, published a paper to warn about the use of digital currencies to finance terrorist groups.

Satoshi

December 5th 2010, 09:08:08 AM bitcointalk.org

Satoshi

December 11th 2010, 23:39:16 PM

No, don’t “bring it on”.

The project needs to grow gradually so the software can be strengthened along the way.

I make this appeal to WikiLeaks not to try to use Bitcoin. Bitcoin is a small beta community in its infancy. You would not stand to get more than pocket change, and the heat you would bring would likely destroy us at this stage.

It would have been nice to get this attention in any other context. WikiLeaks has kicked the hornet’s nest, and the swarm is headed towards us.

Bitcoin’s founder was alarmed by the news that Wikileaks was seeking to raise funds using the decentralized payment system.

Late 2010 - Ross William Ulbricht, who went by the name of ‘Dread Pirate Roberts,’ founded the site Silk Road. Ulbricht, a former Penn State graduate student and amateur programmer with strong libertarian and anarchist views, dreamt of an online marketplace where people would be able to buy and sell narcotics and other illicit items, without governmental interference. While the users of a Darknet site can use Tor and Virtual Private Networks to obscure and hide their identities, they had no way of exchanging anonymous payments among themselves, short of sending envelopes full of cash via the postal service, an obviously impractical solution. Ulbricht got around this conundrum by using Bitcoin as a payment method.

Silk Road opened to modest beginnings, with psychedelic mushrooms grown by Ross himself listed as the first items for sale. However, Ross promoted his site on the Bitcoin forum, an act which attracted a few buyers for his mushrooms, but ultimately led to his downfall. By the end of February, 28 transactions for narcotics ranging from LSD to mescaline were conducted on the site. In two months, over a thousand people had registered.

The real influx of users however, took place after Gawker, an online gossip column, ran an in-depth story on Silk Road. Within a few months, Ulbricht had recouped his initial investment, and was able to create a virtually anonymous and thriving marketplace for the sale of narcotics, complete with a review function of vendors, similar to Amazon or eBay. In that time, the price of a single bitcoin had skyrocketed from around $1 to over $30, a rise attributable in no small part to the increased attention Bitcoin received because of the Silk Road. This attention was unwanted by Satoshi, who was witnessing the extent to which Bitcoin was becoming a target for the US government following its association with crime.

Ross Ulbricht (bottom left) was found guilty of charges including money laundering, conspiracy to traffic narcotics and computer hacking, and is currently serving a double life sentence plus 40 years, without the possibility of parole.

coindesk.com

The Silk Road, like many startups, had begun simply enough as a college curiosity.

December 12th 2010 - Software version 0.3.19, Satoshi’s last, was released. Read now like the final public message from Bitcoin’s creator, it seems tactical that he chose to wind down measures taken in the wake of community friction and media controversies. Still, it’s difficult to say if Satoshi’s decision to walk away was his alone. After all, over the year, there had been a dramatic change in tone toward his leadership.

As to whether he intended to leave, however, Satoshi was definite, his sign-off observable when he removed his name from Bitcoin’s copyright statements. Thereafter, he would also update bitcoin.org, adding the names and emails of other developers, including Gavin Andresen and Laszlo, to its contact page and removing his own. What little we know about the transition was represented by Andresen publicly when he claimed a week later to have received Satoshi’s blessing to ’start more active project management. ’In the interim, Andresen assumed the trappings of authority, putting out a ‘help wanted’ post and making clear to new volunteers they would now need to move the project forward.

It was the kind of thing he knew would create conspiracy theories, and it did.

Though many events loom in the Bitcoin lore, few compete with Gavin Andresen’s infamous visit with U.S. intelligence in June 2011. In the decade since, the event has been linked to everything from the alleged murder of Satoshi Nakamoto to the start of a years long effort to subvert the network and bring it under government control.

The idea that one of Bitcoin’s leading technical figures would in any way engage with U.S. agencies is tantamount to heresy, a perversion of its most enduring value proposition, preserving the first digital money free from government influence. Not only did Andresen attend such an event, but it appears that Satoshi continued to work on Bitcoin, if only behind the scenes, up until the day Andresen accepted the invitation.

Satoshi

April 26th 2011, 19:04:06 PM

Private Emails

I wish you wouldn’t keep talking about me as a mysterious shadowy figure, the press just turns that into a pirate currency angle. Maybe instead make it about the open source project and give more credit to your dev contributors; it helps motivate them.

The idea that one of Bitcoin’s leading technical figures would in any way engage with U.S agencies is tantamount to heresy.

Complicating matters, however, is that as Andresen vaulted into the limelight, it’s unclear if he continued to remain aligned with Bitcoin’s creator on project goals and vision. He would prove inconsistent in remarks, describing development as a ‘controlled anarchy’ in a March interview, yet noting he felt that he and Satoshi reserved the right to enact unilateral change if it was ever needed.

The last traces of Satoshi Nakamoto’s online communication date back to spring 2011, when Satoshi Nakamoto exchanged a few emails with key users of the initial development of Bitcoin. What is considered the last verified email sent by Satoshi Nakamoto, and made public, is the one received by Gavin Andresen, which noted ‘I wish you wouldn’t keep talking about me as a mysterious shadowy figure’.

This was followed by a separate message that contained only a copy of the cryptographic key to Bitcoin’s alert system, one that effectively gave Andresen sole control over security notifications.

Satoshi

April 23rd 2011, 15:40:00 PM

Private Emails

During the same days, Satoshi Nakamoto had exchanged emails with two of Bitcoin’s early developers, Martti Malmi and Mike Hearn. In a first email, Hearn asked Satoshi Nakamoto what his intentions were in terms of his involvement in the development of Bitcoin for the coming months.

Satoshi simply told him that the Bitcoin revolution was in good hands and that he had decided to take care of other things.

Satoshi Nakamoto exchanged a few more emails with Martti Malmi at the very beginning of May 2011 asking him to take full ownership of the bitcoin.org website. At the time of this transfer, and just before he disappeared completely, Satoshi Nakamoto sent an email confirming what he had previously told Mike Hearn.

From: Satoshi Nakamoto <satoshin@gmx.com>

Date: Sat, Apr 23, 2011 at 3:40 PM

To: Mike Hearn <mike@plan99.net>

I’ve moved on to other things. It’s in good hands with Gavin and everyone.

I do hope your BitcoinJ continues to be developed into an alternative client. It gives Java devs something to work on, and it’s easier with a simpler foundation that doesn’t have to do everything. It’ll get critical mass when impatient new users can get started using it while the other one is still downloading the block chain.

Andresen replied to the email from Nakamoto, but the Bitcoin creator never responded.

Over the years there has been intense speculation over who created Bitcoin and who Satoshi Nakamoto might be. A man, a woman, an intelligence agency or a small group of dedicated cypherpunks? Many people have faced claims that they are Nakamoto, and many denials have been issued. Many more people have claimed to be Nakamoto, but they are rarely believed.

THE SUSPECTS

Obvious name similarities and also lived in the same small city as Hal Finney. Has a background working on secret government defence projects.

In March 2014, a Newsweek columnist published a story called ‘The Face Behind Bitcoin.’ She claimed Bitcoin’s inventor was a retired physicist named Dorian Nakamoto. When Goodman arrived at Dorian’s home in California, he said he was ‘no longer involved in that’ and he ‘cannot discuss it.’ The commentary prompted Goodman and her Newsweek cohorts to assume he was talking about the creation of Bitcoin, so they published an exposé about Dorian’s life.

In 2014, Newsweek’s Leah McGrath Goodman published an exposé on Bitcoin’s inventor and her report claimed it was the California resident Dorian Nakamoto. Goodman spent two months investigating her story and one of her biggest selling points was the fact that Dorian’s birth name is Satoshi Nakamoto.

Instead of being a member of the cypherpunk movement, at the time Dorian was a 64-year-old Japanese-American, retired physicist and well-educated engineer. Dorian’s life skills and occupation made Goodman and others believe that he had what it takes to invent the cryptocurrency and release it to the world anonymously. Because Dorian worked for a few corporations and the U.S. military, some of the projects he worked on were deemed classified information. The shroud of secrecy made Goodman once again believe that Dorian was part of Bitcoin’s initial creation.

McGrath drove to California after studying Dorian’s life for two months and visited his house located in Los Angeles’s San Gabriel foothills. She got two police officers from Temple City to escort her. When Goodman caught Dorian leaving his home she faced him with two police officers as witnesses and questioned him about his involvement with creating Bitcoin. Goodman said that Dorian’s response was ‘careful but revealing.’ The Newsweek columnist stressed that Dorian “tacitly acknowledged’ his role in the Bitcoin project but refused to answer direct questions. ‘I am no longer involved in that and I cannot discuss it’ Dorian told Goodman and the officers that day. ‘It’s been turned over to other people. They are in charge of it now. I no longer have any connection.’

All this made Goodman believe all the more Dorian was denying his role, and she thought she had found the mysterious creator. So the reporter and her publication Newsweek decided to run the expose on Dorian’s life story and claimed several similarities between Dorian and Bitcoin’s anonymous inventor. Following the published story, the entire Bitcoin community debated the subject but a great majority of crypto proponents didn’t believe.

The biggest evidence that the article leveraged was that Dorian was a Japanese-American, worked on classified projects, graduated in physics from California Polytechnic, and when he was questioned directly he said he had ‘turned it over’ to other people. Dorian also lived very close to Hal Finney’s house and the Japanese-American showed he leaned toward a libertarian like ideology. Finney’s address was only a few blocks away from the Nakamoto’s family home.

This was an uncanny link. Finney is known to be the second ever user of Bitcoin after Satoshi Nakamoto himself. He had been one of the first supporters of the idea when Nakamoto floated it on a cryptography mail list, and even received the first Bitcoin test transaction from Nakamoto in early 2009, as Finney himself wrote in a post to the Bitcointalk forum. Had Finney invented Bitcoin himself and simply used his neighbor’s name as a pseudonym? He is also smart enough to complete the project as coworkers noted that Dorian worked on ‘defensive electronics and communications for the military.’ Dorian’s daughter spoke to Goodman and told the reporter that her father wholeheartedly believed in individualism.

Perhaps the most compelling parallel between the two Nakamotos are their professional skill sets and career timeframes.

However, Dorian told the public shortly after the publication that he felt victimized and he misunderstood Goodman’s questions. Dorian claims he thought the reporter was talking about a classified project that he worked on with the financial giant Citibank. After Dorian told his side of the story, the crypto community was outraged with Newsweek and Goodman’s report. They complained that Dorian was doxxed, as the article contained a photograph of his home in California.

All this invoked bitcoiners to start a fundraiser for Dorian in order to pay for his troubles and the invasion of privacy that the Newsweek article started. Dorian also did a video with the Bitcoin evangelist Andreas Antonopoulos telling his side of the story and he thanked the Bitcoin community for all the donations he received. The BTC address: 1Dorian4RoXcnBv9hnQ4Y2C1an6NJ4UrjX has received over 102 BTC and the wallet is now empty. This is a stark contrast to the over 1 million BTC sitting in the Satoshi Nakamoto wallets that have been left unspent for over a decade.

Following Dorian’s Newsweek expose, the Japanese American became a hero amongst the crypto community appearing on posters, t-shirts, and stickers. Dorian has appeared at crypto conferences and discussed his experience after Newsweek’s hit piece turned his normal, toy train-collecting life upside down. Moreover, with the slew of unattractive self-proclaimed Satoshis who have come out of the woodwork, many crypto proponents actually wish Dorian was Satoshi, as he’s far more friendly. People have even crowned Dorian as the best Satoshi Nakamoto suspect in years.

Following the media storm that the Newsweek article started, Satoshi Nakamoto’s long dormant P2P Foundation account resurfaced, posting a simple message. ‘I am not Dorian Nakamoto.’ In September, the account posted another message saying it had been hacked, raising questions over the earlier message’s authenticity.

Dorian Nakamoto after the Newsweek article broke and reporters swarmed his house bitcoin.com

I AM NOT DORIAN NAKAMOTO

Worked very closely with Satoshi, and was the first person to receive a Bitcoin transaction. An avid cypherpunk who also created the idea of proof of work before Bitcoin.

While the oft-cited candidates are many, there’s something special about avid runner, cypherpunk and early Bitcoin contributor Harold Thomas Finney II, better known simply as Hal, that makes people want to believe he’s the one.

Finney graduated from world-renowned Caltech with an engineering degree in 1979. After working in computer game development for some years he then went on join the PGP Corporation, creating some of the first ‘pretty good privacy’ the world had seen. Finney was an OG cypherpunk, a member of the early 90s mailing list and avid developer and philosopher when it came to crypto solutions for preserving privacy, anonymity and financial autonomy. Like many cypherpunks, Finney was inspired by the work of David Chaum, another Los Angelino cryptographer who had proposed theoretical systems that would use encryption tools to enable anonymous communications and even untraceable financial transactions. Finney put his programming prowess to work building the tools to enact that cryptoanarchist vision.

When word hit the mailing list that privacy activist Phil Zimmermann planned to release PGP or Pretty Good Privacy, the first freely available encryption program strong enough that not even government intelligence agencies could break it, Finney contacted Zimmermann and became one of his earliest collaborators. He worked almost a full-time job’s worth of hours developing PGP 2.0, widely considered to be the first truly secure version of the program, and pioneered its ‘web of trust’ model of key-signing, a method to establish trusted identities through the peerto-peer vouching of a community of users.

In fact, decades before anyone suspected Finney of ghostwriting Bitcoin, Finney ghostwrote much of PGP. Because of the legal controversy around the encryption tool’s distribution on the Internet, Zimmermann was nearly indicted for arms export control violations and Finney’s role was downplayed in Zimmermann’s public discussion of the program.

Hal Finney retired from the PGP Corporation in early 2011. Satoshi Nakamoto’s last known email correspondence is dated April 26, 2011.

As PGP’s usage spread, Finney was also the first to integrate the encryption software into ‘remailers’, free services that acted as proxy servers for email, bouncing messages among third parties so that they couldn’t be traced to their source. Those tools would eventually evolve into strong anonymity services like MixMaster and Tor, used by millions around the world today. Meanwhile, Finney never gave up on Chaum’s ideas of digital, pseudonymous currency. A few years later, Finney would even develop a ‘proof-of-work’system that closely resembled the one Bitcoin would later use.

So when the idea for Bitcoin first appeared on a cryptography mailing in 2008, posted by Satoshi Nakamoto, Finney says he was immediately enthusiastic, and responded with curious questions.

Finney downloaded the early Bitcoin code and began running it on an IBM Windows desktop tower machine. He’s widely believed to be the first person other than Nakamoto himself to do so. He kept it running for weeks, just how long, is not known. With no competition, he was able to mine as much as a hundred coins a day using only his old PC’s off-the-shelf CPU. But sometime after mining a thousand coins, Finney turned the machine off, he and his son were worried the computer was overheating. The stash of bitcoins sat on Finney’s hard drive and were later burned to a DVD, left to gather dust on a desk.

Hal Finney was the very earliest adopter and developer of Bitcoin apart from Satoshi himself.

Hal and his wife Fran at APh Technological Consulting, 1978. publish0x.com

During his Bitcoin experimentation, Finney corresponded with Nakamoto, sending him a series of bug reports and suggestions for fixes. He would later write that while he had no idea of Nakamoto’s real identity or location, he imagined Bitcoin’s creator to be ‘a young man of Japanese ancestry who was very smart and sincere.’

In early 2009, Nakamoto also sent Finney the first ever test transfer of bitcoins. Finney said at the time he’d repay the ten coins back to Nakamoto. He never did, as recalled by his wife Fran, he had other things on his mind by then. Finney inexplicably began to fatigue quickly, slur his words, experience strange tingling, and lose coordination in his right hand. His doctor diagnosed him with ALS in August of 2009.

As Finney’s muscle control declined over the next years, he continued to write code for Bitcoin. At one point he wrote up an improvement to its elliptic-curve cryptography that would speed up its transactions by as much as 20%. Even after he lost the ability to type with both hands, and then to type at all, he continued to use eye-tracking software to write code.

As for the bitcoins Finney mined in those early days, he said that he was relieved to rediscover them in 2010, still intact, as the currency suddenly began to gain value. He transferred them to the disc, and then later stored it in a safety deposit box at the family’s bank. But as Finney’s medical bills mounted, Finney sold the majority of the coins at an exchange rate of around $100, just a fraction of the more than $50,000 they’d be valued at today.

Hal Finney died on August, 2014, at the age of 58, as a result of his illness. But Hal Finney was a very optimistic person, he believed in the future advancement of the technologies, and his faith was strong. He was cryopreserved by the Alcor Life Extension Foundation after he died, and he had cryopreservation arrangements with the Alcor Foundation for over 20 years. In fact, Finney and his wife both decided to have their bodies cryonically frozen more than 20 years ago. At the time, Finney, like Alcor’s president More, was an active member of the Extropians, a movement of technologists and futurists focused on transhumanism and life extension.

Finney’s warm spark of childlike enthusiasm and down to earth approachability brought a human element to his work and legacy.