Who Was the Real Satoshi Nakamoto

Who would create a multi-billion-dollar phenomenon using a fake identity, then simply vanish without appearing to cash in on their success or even claim the credit for their game-changing achievement?

Any cryptocurrency fan would be able to answer that question without a moment’s hesitation. Clearly, we are talking about none other than Satoshi Nakamoto, the mysterious coder who launched Bitcoin back in 2008 when he published a white paper entitled Bitcoin: A peer-to-peer electronic cash system.

The identity of Bitcoin founder, Nakamoto is one of the greatest mysteries of the 21st century. In a world defined by the oversharing of information, it seems incredible that someone should succeed in founding something as remarkable as Bitcoin without anyone knowing who they are. Over the years, various people have either been suspected of being Nakamoto, or have claimed to be him, but to this day there is no real consensus about who the real Nakamoto is or was.

Origins of bitcoin

Bitcoin is the world’s most successful cryptocurrency and the first to go mainstream. Today the market capitalization of Bitcoin is more than $500 billion. To put that figure into context, it’s greater than the market capitalization of global payments giant, Visa – a massive achievement given Bitcoin has only been in existence for 15 years.

Between 2008 and April 2011, the point when he vanished, Nakamoto played an active role in getting the Bitcoin project off the ground. From the start, he realised that if his vision of a peer-to-peer electronic cash system was to succeed, he would need the support of others. So, he made the code to mine bitcoin available to other developers via the forum of the non-profit organization, P2P Foundation.

The timing of Bitcoin’s launch was apt since the world was in the grip of a global financial crisis and faith in the conventional banking system had been badly shaken. Governments around the world had used taxpayer money to rescue floundering banks and Nakamoto’s white paper was published just weeks after US investment giant Lehman Brothers had collapsed.

The notion of a currency that would operate without central intermediaries, such as banks and governments, looked like the right idea, at the right time. Hence, Nakamoto’s vision succeeded in piquing the interest of a small, but dedicated, group of fellow developers.

When it came to getting Bitcoin up and running, Nakamoto proved to be a very willing collaborator. He set up a dedicated forum called Bitcointalk to host Bitcoin-related discussions and helpfully answered queries from developers on a wide range of issues, relating to both the technological challenges associated with building Bitcoin and the overall vision for the cryptocurrency. Nakamoto appeared to enjoy having the opportunity to explain his thinking. He also actively sought input from others – for example, asking for feedback on the new Bitcoin logo in February 2010.

The collaborative nature of the Bitcoin project has been fundamental to its success. Bitcoin is underpinned by egalitarian principles, being organised in a way that ensures that no single individual or organisation can take full control of the network. The developers who helped to establish the project in the early days had a stake in the game since they earned bitcoin from mining it. Nakamoto himself removed his name from the copyright claim in the Bitcoin software after he exited the project, leaving the code to all Bitcoin developers.

Who was the real Satoshi Nakamoto?

So, Nakamoto was a great visionary and a great collaborator. Plus, he had a good understanding of economics and was a talented coder, with detailed knowledge of the programming language C++.

But what else do we know about him? Sadly, not a great deal. Throughout his involvement in the Bitcoin project, he was determined to guard his anonymity, probably because he feared attracting the attention of governments or criminals, but also because he never wanted to become bigger than the Bitcoin project itself. As a result, he gave away no personal information in his forum posts or emails to other Bitcoin developers. Nevertheless, he did leave behind a few clues that offer some useful insights into who he was. (And we will assume, for the sake of argument, that he was a man).

The first thing we can be pretty sure of is that – despite his name – Nakamoto was almost certainly not Japanese. His command of the English language suggests he was a native speaker and analysis of the timing of his posts on the Bitcointalk forum suggests that he either lived in Europe or on North America’s East Coast.

Why he would choose to operate under a Japanese pseudonym is part of the overall mystery, but there is meaning in the name he chose. In Japanese, Satoshi is a masculine given name that translates to ‘clear thinking’, ‘wise’ and ‘intelligent history’. Meanwhile, Nakamoto means ‘one who lives in the middle’. These names suit the founder of a decentralized electronic currency system who has changed the course of history.

There is a fair amount of debate over whether Nakamoto was one person or a group of people, but, again, no clear consensus has been reached. The workload, timing of posts and mixture of UK and US English might suggest a group of people. On the other hand, Nakamoto could have been a very hard worker who stayed up late at night and was either poor at spelling or used US English at work and British English at home in his private life.

Perhaps the main argument against Nakamoto being a group is the fact the group has not broken ranks over the years. It’s one thing for an individual to carefully maintain their anonymity and resist the temptation to touch the original holding of 1.1 million bitcoins mined by Nakamoto back in 2009 (and now worth around $32 billion), but that level of self-control is much harder for a group to maintain. After all, if Nakamoto’s coins were converted into dollars, they would make him one of the 50 richest people alive in the world today.

Is Satoshi Nakamoto alive or dead?

Assuming that Nakamoto is one person, there is also the question of whether he is alive or dead. His last exchange with other Bitcoin developers came in April 2011, two months after Bitcoin had achieved parity with the US dollar for the first time. He announced that he had “moved on to other projects” and after that, he disappeared. It is hard to understand what “other projects” could possibly have been more important to Nakamoto than Bitcoin – unless perhaps he was facing a battle with his own health by that time, a battle that he might have lost, resulting in his death.

In March 2014, the internet stirred with excitement after Nakamoto apparently posted a one-liner on the P2P Foundation website, simply saying “I am not Dorian Nakamoto”. This post appeared to be a response to claims made by US magazine Newsweek that the Bitcoin founder was actually Dorian Nakamoto, a Japanese-American man living in California (claims that Dorian Nakamoto himself firmly refuted). Later in the year, it emerged that Nakamoto’s email account had been hacked, however, casting doubt on the veracity of the March post.

Certainly, if Nakamoto had died, it would help to explain why his original holding remains untouched. On the other hand, he could also have owned Bitcoin under his real name and become fabulously wealthy as a result, negating the need to cash in on at least some of his original holding, with the associated risk of unsettling the market. Alternatively, he might have lost the key to his digital wallet. Or perhaps he just never cared about the money in the first place (which would be a little odd for someone who had gone through all the trouble of inventing an electronic currency system).

The mystery of Satoshi Nakamoto

It’s not just wealth that Nakamoto appears to have turned his back on. He has also shunned all the fame and glory he could have enjoyed had he revealed himself as the true inventor of Bitcoin. His writings depict a modest person, who sought no unnecessary attention. "I wish you wouldn’t keep talking about me as a mysterious shadowy figure“, he complained to fellow Bitcoin developer Gavin Andresen just before he disappeared, “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.” 

Despite his objections to being seen as a “mysterious shadowy figure”, the reality is that’s what Nakamoto continues to be – more than a decade after he sent his last email. But while his identity remains unknown, his philosophy lives on and Bitcoin – in its own volatile way – keeps going from strength to strength. In fact, many would view the current problem of high inflation in many markets as justification for an electronic currency system that operates without the interference of governments and central banks.

“The root problem with conventional currency is all the trust that’s required to make it work”, Nakamoto wrote in 2009. “The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.”