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Category: Currency / Internet Technology / Business, Economics and Finance

Experts divided on Australian's claim he created Bitcoin

Tuesday, 3 May 2016 05:26:54

Entrepreneur Craig Wright confessed to being alias Satoshi Nakamoto, creator of Bitcoin. (Supplied: BBC)

Australian tech entrepreneur Craig Wright has identified himself as the creator of controversial digital currency Bitcoin, but experts remain divided over whether he really is the elusive pioneer who has gone by the internet name of Satoshi Nakamoto until now.

Key points:

  • Bitcoiners say Craig Wright's evidence of being Satoshi Nakamoto is insufficient
  • Mr Wright's cyber team who helped develop the currency confirm it is him
  • Pundits say the technological legacy of Bitcoin is now bigger than its creator

Uncovering Nakamoto's true identity would solve a cyber riddle dating back to the first pseudonymous publications of the open source software behind the crypto-currency in 2008, before its launch in 2009, after which Nakamoto mysteriously disappeared.

In that time, Bitcoin has become the world's most commonly used virtual currency, attracting the interest of banks, speculators, criminals and regulators.

Some online commentators suggested Bitcoin's creator could help resolve a bitter row among the currency's software developers that threatens its future.

But Mr Wright made no reference to the row in the BBC interview identifying himself as Nakamoto, and as the protocol Bitcoin runs on is open-source and cannot be controlled by any one person, it is unclear whether he would be able to influence the way it develops.

"I was the main part of it, other people helped me," Mr Wright, who is now living in London, told the BBC.

"Some people will believe, Some people won't, and to tell you the truth, I don't really care."

The BBC reported on Monday that Mr Wright gave some technical proof demonstrating that he had access to blocks of Bitcoins known to have been created by Bitcoin's creator.

But many bitcoiners were quick to prove that Mr Wright had not done enough to definitively prove that he was Nakamoto, who maintained his anonymity throughout his involvement with Bitcoin, which he stepped away from in 2011.

Satoshi Nakamoto is now the leader of a movement.

Blockchain entrepreneur Roberto Capodieci

Sceptics argued that none of the information Mr Wright divulged as proof of his identity was new.

But soon after the media frenzy, the cyber experts that Nakamoto contacted in 2008 to carry and complete his Bitcoin vision, said that Mr Wright had met with them separately, and offered solid proof it was him.

Gavin Andresen, the chief scientist who Nakamoto chose to succeed him, published a blog post on Monday in which he described meeting Mr Wright last month and said he is "convinced beyond a reasonable doubt" that the Australian is Nakamoto.

External Link: Bitcoin entrepreneur and coder tweets.

Jon Matonis, a founding director of the Bitcoin Foundation who now works as a Bitcoin consultant, also wrote a blog post which, like Mr Andresen's, supported Mr Wright's claims.

"According to me, the proof is conclusive and I have no doubt that Craig Steven Wright is the person behind the Bitcoin technology, Nakamoto consensus, and the Satoshi Nakamoto name," Mr Matonis wrote.

Crypto-currency expert Ian Grigg then also wrote in a blog that he could "confirm [it] is true, both from direct knowledge and a base of evidence"

All three experts also confirmed they had been responsible for their respective blog posts, and that the accounts were not hacked, putting to rest suspicions from sceptical Bitcoiners.

'Satoshi is dead, but this is the beginning'

If Mr Wright is Nakamoto he "is now the leader of a movement", said Roberto Capodieci, a Singapore-based entrepreneur working on the blockchain, the technology underlying the currency.

That movement ranges from libertarian enthusiasts to central banks experimenting with digital currencies, all of which pay homage in some way to Nakamoto's writings.

But Nakamoto's biggest likely legacy now lies well beyond his control.

What is bitcoin?


Can't tell a bitcoin from a blockchain? Read our explainer to see how the cryptocurrency works.

The blockchain technology that underpins the currency could transform the way banks settle transactions, the way that property rights and other vital data are recorded, and provide a way for central banks to issue their own digital currencies.

Researchers believe Nakamoto may be holding up to one million of the more than 15 million Bitcoins currently in circulation, which would make the creator worth around $574 million.

In a blog post also dated Monday, Mr Wright posted an example of a signature used by Nakamoto and an explanation of how Bitcoin transactions are verified and thanked all those who had supported the project from its inception.

Bitcoin key points

  • A decentralised cryptocurrency
  • Released as a working beta in 2009
  • The digital currency can be traded for other currencies or real world goods
  • It can be created (mined) by computers set to the task of solving mathematical 'blocks'
  • There is a cap of just under 21 million bitcoins
  • Coin transactions and ownership recorded in a public ledger called the blockchain
  • Bitcoins are secured in your digital wallet

"This incredible community's passion and intellect and perseverance have taken my small contribution and nurtured it, enhanced it, breathed life into it," he wrote.

"Satoshi is dead. But this is only the beginning," he added.

However, Mr Wright did not explicitly write on his blog that he was Nakamoto, and cryptologists were quick to point out the shortcomings of his online proof.

Bitcoin expert Peter Van Valkenburgh, director of research at Washington, DC-based advocacy group Coin Centre, said a new message cryptographically signed using the private key associated with the so-called Genesis block, the first ever "mined" would have been more convincing.

Mr Wright also spoke with The Economist, but declined requests from the magazine to provide further proof that he was Nakamoto.

His representatives said he would not be taking part in more media interviews for the time being.

"Our conclusion is that Mr Wright could well be Mr Nakamoto, but that important questions remain," The Economist said.

"Indeed, it may never be possible to establish beyond reasonable doubt who really created Bitcoin."

Reuters/ABC

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