Who Created Bitcoin? Who Is Satoshi Nakamoto?

WhiteBIT
Published 11 August 2023
8307
Who Created Bitcoin? Who Is Satoshi Nakamoto?

Since the introduction of Bitcoin in 2009, it has become one of the most discussed and mysterious phenomena in the world of finance and technology. Despite the fact that BTC is an open and decentralized project, Bitcoin’s creator remains in the shadows and uses the pseudonym Satoshi Nakamoto. How did bitcoin come about? Who started Bitcoin and what are his motives? Let’s consider everything in order.

When Did Bitcoin Start?

The development of a successful cryptocurrency project was preceded by a series of unsuccessful attempts to create a viable digital asset. What was before and when did bitcoin come out?

B-money and Bit Gold

One of the early digital money projects was known as “B-money”. In 1998, Wei Dai, a computer engineer and active member of the crypto punk mailing list, introduced the concept of “anonymous distributed digital assets”. He highlighted the future concept of bitcoin, including the basic principles of encryption and mining. However, “B-money” was never implemented, but Wei Dai became famous in the crypto community. He contributed to the development of VMAC (Message Authentication Algorithm), as well as the discovery of vulnerabilities in the SSH2 and SSL/TLS protocols. By the way, the smallest unit of the second most popular cryptocurrency Ethereum is named “wei” in the engineerʼs honor. In 1998, Nicholas Szabo presented to the world his concept of a decentralized digital currency called “Bit gold”. This project also did not materialize. Many people notice a number of significant similarities in the operation of the bit gold and bitcoin mechanisms, and also some chronological coincidences, which leads to the theory that Nick Szabo and Satoshi Nakamoto are the same person. Szabo denies this assumption, but we will touch on the scientist’s identity in this article.

Bitcoin

It’s time to explain where bitcoin came from. The concept of Bitcoin was born in 2008 when Satoshi Nakamoto, an enigmatic figure or group of people, published his or their famous White paper called Bitcoin: A Peer-to-Peer Electronic Cash System. In this document, Satoshi Nakamoto presented the concept of a new cryptocurrency that was completely decentralized and did not require intermediaries to conduct financial transactions.

In January 2009, the first version of the Bitcoin software was released, and the first transaction was sent on the 12th of January, 2009, when Satoshi Nakamoto sent 10 Bitcoins to Hal Finney, one of the first people to take a public interest in the Satoshi crypto. It can be said that Bitcoin was created and first launched in January 2009, and since then it has still been one of the most influential and significant cryptocurrencies in the world.

How much was bitcoin when it started? It started with essentially no value. The initial price was negligible, often considered to be fractions of a cent. It wasn’t until a couple of years later that Bitcoin began to gain any significant value.

What Is Known About Satoshi Nakamoto?

Satoshi Nakamoto is a mystery in the world of cryptocurrencies. The crypto community suggests that this is just a pseudonym used by the creator of BTC. Although the true identity of Satoshi remains unknown, there is information and various versions that can help unravel the mystery.

Satoshi Nakamoto first introduced bitcoin in October 2008 in the paper we mentioned above. This document described the ideas and principles behind Bitcoin and blockchain technology. Nakamoto also developed the first client code to run bitcoin and mine the first blocks.

Related Article:
What is cryptocurrency mining?

Related Article:

What is cryptocurrency mining?
Read the article

During the creation of Bitcoin, Satoshi Nakamoto actively communicated and shared his ideas with other developers and enthusiasts via email and on the Bitcoin Forum. However, in April 2011, his online activity ceased. Since then, he has not been in direct contact with the community.

The identity of Satoshi Nakamoto is still unknown. Despite various theories and attempts at identification, no one has been able to reliably confirm who is behind this pseudonym.

Journalists from The New Yorker and The Fast Company conducted investigations to find out the identity of Satoshi. But all those who could be the real creators, according to journalists, strongly denied their involvement in the first crypto.

Information From Satoshi Nakamoto Himself

The data that Satoshi left us about himself is very small. He indicated that he was born in Japan on the 5th of April, 1975. At the same time, the crypto community is absolutely convinced that Satoshi Nakamoto is a pseudonym, and his real name is still hidden under a veil of secrecy. In Japan, it is not customary to write the first name before the last name, as Nakamoto constantly did when communicating online. In addition, the creator of Bitcoin never used Japanese words, but wrote in perfect English.

Another factor that refutes the hypothesis of Bitcoin father’s Japanese origin is the time of Nakamoto’s activity on the network. He was active at night in the Japanese time zone. If Satoshi Nakamoto worked from Japan, he would sleep during the day and work at night for several years in a row.

Satoshi’s date of birth, the 5th of April, 1975 is very similar to the hidden message. He wanted to draw attention to the imperfections of the modern financial system based on the gold standard, which the world’s financial elites themselves abolished in 1971. It was on the 5th of April, 1933 that US President Franklin Roosevelt signed a decree according to which Americans were forbidden to accumulate and store gold (this right was returned to Americans only in 1975).

Why Did Satoshi Nakamoto Disappear?

Satoshi Nakamoto was the first to implement blockchain technology by creating the Bitcoin protocol. But in April 2011, shortly after bitcoin became publicly known, Nakamoto no longer made contact. Why did this happen? There are several theories floating around in the cryptocurrency community:

  • Philosophy of ideal decentralization. He created Bitcoin with the goal of giving people complete control over their finances and avoiding the influence of centralized structures. Probably, Satoshi understood that his identity as a creator could become a weak point and a subject of pressure or manipulation. So, he decided to go into the shadows to maintain the integrity and independence of Bitcoin;
  • Anonymity and privacy. Bitcoin, as a decentralized cryptocurrency, provides the user with a high level of privacy. Satoshi Nakamoto, as the creator, probably wanted to keep this integrity. His disappearance may be a way to protect his identity and preserve the principles on which Bitcoin is based;
  • Continue without me. He could have simply passed the responsibility on to other developers and members of the Bitcoin community. After all, Bitcoin quickly attracted attention and began to develop on its own thanks to the contribution of many people. Satoshi could count on their work and the attention of the community to ensure the further cryptoʼs development and prosperity without his active participation.

On the 23rd of April, 2011, Satoshi Nakamoto left his last message: “I’ve been busy with other things. It [Bitcoin] is in good hands with Gavin and others.”

Who Invented Bitcoin? Probable Satoshi

For many years after the advent of Bitcoin, the mystery of its creator remained unsolved. There is a person who invented and developed BTC under the pseudonym Satoshi Nakamoto. Despite the lack of concrete evidence, the crypto community is still actively discussing who could be hiding behind the mask of Satoshi Nakamoto.

Many alleged Satoshis are members of the crypto punk mailing list. We know for sure that the real Satoshi was an active participant of this community. But what is this movement? And who is behind Bitcoin?

The Gilmour Group and the Crypto Punks

In 1992, three people—John Gilmour, Eric Hughes, and Timothy May—created their own mailing list. They met regularly at the offices of Cygnus, founded by Gilmour (which was acquired by Red Hat in 1999), and discussed a wide range of topics, including mathematics, cryptography, computer science, politics, and philosophy. In two years, their mailing list has attracted over 700 members and has become one of the largest and most active communities in its field. Satoshi Nakamoto was also on this list.

The crypto punks not only led theoretical discussions about privacy and digital privacy, but also uncovered various secret government spyware. For example, they exposed the design of the Clipper telephone chip, developed at the US government’s initiative. The chip provided encryption of telephone conversations to protect against fraud, but at the same time provided the intelligence services with the ability to covertly listen to any number. Due to public protest, the project was closed.

The crypto punksʼ activities also led to the creation of PGP (Pretty Good Privacy) privacy software, anonymous remailers, and contributed in part to the Linux operating systems kernelʼs development.

In the 1980s, a group of young visionaries in cryptography and computer science grew up in the US, united by a common desire for anonymity and digital freedom.

The crypto punks (from the words “crypto” and “punk” or “cyberpunk”) foresaw the problem of data privacy on the Internet and were many years ahead of their time.

The crypto punks communicated through mailing lists known as “remailers”. These systems automatically forwarded received messages from authors to all recipients included in a certain list, something like the forefathers of the forums before they existed.

Dorian S. Nakamoto

Dorian Satoshi Nakamoto is a name that became famous after journalists mistakenly linked him to the creator of Bitcoin. In 2014, Newsweek journalists published an article claiming that Dorian S. Nakamoto is Satoshi Nakamoto’s real name. However, Dorian S. Nakamoto himself denied this information.

According to an interview given by Dorian S. Nakamoto after the article was published, he denied being connected to Bitcoin and stated that he had nothing to do with the creation of the cryptocurrency. He was a Japanese-American electronics engineer and was born in 1949.

After making erroneous claims about his connection to Bitcoin, Dorian S. Nakamoto became the subject of public scrutiny and intrusive questions from the media and the crypto community. Meanwhile, the identity of the real Satoshi Nakamoto is still waiting to be solved.

On March 7, 2014, Satoshi himself denied Dorian’s involvement with Bitcoin: “I am not Dorian Nakamoto.”

Nick Szabo

Nicholas Szabo is a much talked about person in the world of cryptography. Although he is not as famous as Satoshi Nakamoto, his contribution to blockchain technology is immeasurably important.

Nick Szabo was one of the early pioneers in the field of cryptocurrencies. In the early 1990s, he developed the concept of Bit Gold, a prototype cryptocurrency that anticipated the technical principles of Bitcoin. Nicholas even introduced the term “smart contract” into the crypto environment. Unfortunately, the implementation of Bit Gold was not completed and remained at the concept level.

Some crypto researchers and experts claim that Nick Szabo may be the very mysterious person behind the pseudonym Satoshi Nakamoto. But there is still no concrete evidence to confirm or refute this theory. Szabo denies this theory: “I’m afraid you made a mistake in calling me Satoshi, but I’m used to it.”

Hal Finney

Hal Finney, also known as Hal Finney Junior, is a famous figure in the crypto world. He was actively involved in the early development of Bitcoin and made significant contributions to its ecosystem.

Finney was born in 1956 in Arizona, USA. As a programmer, he saw the potential and importance of Bitcoin and became one of its early adopters. Hal became the inventor of the Proof-of-Work consensus algorithm.

Hal Finney received the first Bitcoin transaction from Satoshi Nakamoto on the 12th of January, 2009. It was 50 BTC. He was the second person, after Nakamoto himself, to start mining Bitcoins and take part in the network’s development.

Hal’s most famous contribution was his participation in the development of the first alternative Bitcoin client called Bitcoin-Qt (also known as Bitcoin Core). He became one of Bitcoinʼs main customers and played an important role in the further development of the network.

Before dying from illness in 2014, Finney denied community speculation that he was Satoshi. At that time, he could only answer questions with simple “yes” or “no” answers with eye movements: if Hal raised his eyes and eyebrows, it meant “yes”, if lowered, it meant “no”. The answer to that question was “no”.

Adam Back

Adam Back is another notable person in the world of cryptography. He is a computer scientist, crypto punk, and one of the early adopters of Bitcoin and blockchain technology.

One of Adam’s significant contributions is the development of the Hashcash hash function. It was first introduced in 1997 and has become an important tool against spam. It also helped to create the Proof-of-Work algorithm.

Adam Back is one of the founders and current CEO of Blockstream. He is engaged in blockchain research and various innovative solutions, including the deployment of the Lightning Network. Back is actively involved in Bitcoin protocol development.

The theory that Adam Back is Satoshi Nakamoto has some arguments:

  • During the launch of Bitcoin, Back was an active member of the crypto punk community, but then temporarily withdrew from discussions and correspondence. He returned to the crypto punks after the disappearance of Satoshi Nakamoto. This may indicate that Adam Back and Satoshi Nakamoto worked on Bitcoin, but did not overlap in correspondence and discussions at the same time;
  • All active crypto punks from the Gilmour group who communicated with Satoshi Nakamoto published their correspondence with him, except for Adam Back. He stated that he deleted his correspondence to protect the identity of Bitcoin founder;
  • After the disappearance of Satoshi, the community was divided regarding the further development of Bitcoin, which led to hard forks and modifications to the original protocol. Adam Back has always consistently defended the ideas and philosophy inherent in the Satoshi Nakamoto project;
  • When Adam Back returned to the project after Nakamoto’s disappearance, the crypto punks remarked that he had a deeper knowledge of blockchain and encryption technologies than most of the members, despite having been out of the project for almost 4 years;
  • At the time of Bitcoinʼs creation, Adam Back lived in London. Several factors indicate that Satoshi Nakamoto was also there;

Also, Hashcash and Bitcoin have similar code patterns, for example, the habit of putting a double space when separating sentences, which was typical for Satoshi Nakamoto, and more.

Adam spoke about this on his Twitter, refuting the participle in the name Satoshi.

Craig Wright

Craig Wright is associated with the history of Bitcoin and is one of the most talked about and controversial names in the cryptocurrency community. He claims that he is the real Satoshi Nakamoto, the founder of Bitcoin. However, the opinion of this statement’s veracity was divided into two camps.

Craig provided various arguments and evidence for his claim. In 2016, he promised to provide technical proof, called the “Satoshi signature key”, which was supposed to testify to his authorship, but later said that he did not have the courage to use it. He also provided correspondence, other documents and technical details supporting his claims. But a lot of Craig’s information turned out to be false, and the evidence was fabricated in hindsight. As of this writing, the self-proclaimed Satoshi has yet to provide sufficient evidence to confirm that he is the real Satoshi.

After his statements, Craig Wright faced criticism and skepticism at a cryptocurrency conference. Vitalik Buterin, Ethereumʼs creator, openly disputed Wright’s claims, calling him a scammer. Wright later filed libel suits against Buterin, podcaster Peter McCormack, and early bitcoin investor Roger Ver. The lawsuits sparked a heated online debate, and people attempted crowdfunding to support the defendants.

Although Craig managed to win some court cases and copyright the White Paper and Bitcoinʼs source code, few people really perceive him as the real Satoshi Nakamoto due to the lack of sufficient evidence, as well as numerous cases of falsification and fabrication from Wright.

Dave Kleiman

Dave Kleiman is also well known in the community of crypto enthusiasts and researchers. His history remains the subject of debate and speculation.

Kleiman is believed to be an Australian computer scientist and businessman. He was involved with Bitcoin and blockchain long before Satoshi Nakamoto’s White Paper was published. According to some sources, Dave claimed his role in the creation of Bitcoin and registered the relevant patents. But these claims have not received sufficient confirmation and have been questioned by the community.

Kleiman has also been involved in legal disputes and court cases related to Bitcoinʼs legacy. These controversies have attracted significant media and public attention.

Elon Musk

In recent years, several theories have emerged linking Elon Musk and Satoshi Nakamoto. These statements are only assumptions, since there is no concrete evidence to prove this.

Sahil Gupta, a former SpaceX intern, presented his point of view on the question of whether Elon Musk is the creator of Bitcoin. The programmer shared that in 2017 he communicated with the businessman’s representative Sam Teller regarding his work. At the end of the conversation, the developer asked Sam if Musk was actually Bitcoin’s creator. Teller was silent for 15 seconds, and then gave a slurred answer: “Well, what can I say?”. To confirm his words, the programmer published a screenshot of the correspondence with the conversation recorded.

Gupta suggested that Elon Musk could be Satoshi Nakamoto in 2017. In his opinion, the businessman had sufficient resources and motivation to become the creator of the first cryptocurrency. He may have had the knowledge of how to make bitcoin. In addition, Musk used vocabulary similar to Satoshi.

Elon denied his participation in Bitcoinʼs creation, and his connection with Satoshi Nakamoto remains only an object of speculation.

Vitalik Buterin

Vitalik Buterin is the founder of Ethereum. There is no credible evidence or confirmation that Buterin is the secret creator of Bitcoin under the pseudonym Satoshi Nakamoto.

Vitalik Buterin is an open and public person, and we are well aware of his contribution to the development of blockchain technologies, especially Ethereum. He continues to actively work on his project, as well as cryptocurrencies and decentralized applications in general.

How Many Bitcoins Does Satoshi Have?

In the early Bitcoinʼs days, Satoshi mined coins using his computer. He amassed a significant bitcoin amount, which is worth billions of dollars today.

In 2010, Satoshi Nakamoto handed over the project to other developers and ceased active participation in the community. Since then, Satoshi bitcoin addresses have remained dormant. He gave some of his coins to other people.

Independent security and cryptocurrency researcher Sergio Demian Lerner has given us the best estimate of Nakamoto’s holdings. In his report “The Deserved Fortune of Satoshi Nakamoto, Bitcoin Creator, Visionary and Genius,” Lerner looked at blocks mined between the 1st of January, 2009 and the 25th of January, 2010 (1 to 36288). He found that during this time, one person mined thousands of blocks, receiving about 1 million BTC as a reward.

In April 2019, Lerner published the following article: “The Return of the Deniers and Patoshi’s Revenge”. Patoshi is the first cryptocurrency “whale”, that is, a trader who owns a million BTC, which received the name from the combination of the words “pattern” and “Satoshi”. The author found that Patoshi had mined about 22 000 blocks alone, receiving a total of 1.1 million BTC. Since then, the block reward has been halved three times, and now miners earn just 6.25 BTC per block mined.

How Satoshi Nakamoto Can Affect the Value of Bitcoin?

Any Satoshiʼs activity is capable of causing a reaction in the digital currency market. News of his activities, or messages believed to be from him, can cause euphoria or panic among investors and speculators.

Nakamoto owns an estimated 1.1 million BTC, or about 5% of the Bitcoin supply. Hypothetically, the simultaneous sale of 1.1 million Satoshi Nakamoto Bitcoins on the market could crash the price to record lows. But for this you need to find a buyer, which is quite problematic. If Satoshi shows up and starts selling his coins, it will cause panic and have a negative impact on the development of the entire industry.

But neither Satoshi Nakamoto nor his crypto wallets were active for a long time.

Interesting Facts

To summarize the information we know about Satoshi Nakamoto:

  1. Personal Mystery: Satoshi’s true identity is still unknown. In an attempt to reveal his identity, many theories and conjectures have arisen, but they remain only assumptions.
  2. Documentation and White Paper: In 2008, Nakamoto published the Bitcoin White Paper, containing a detailed description of the concept and how the cryptocurrency works. This documentation was the starting point for the development of Bitcoin and blockchain technology.
  3. Role in the Development of Bitcoin: Satoshi Nakamoto is the creator of Bitcoin, and for a while he single-handedly kept the network running. Later, he talked with other developers, offered ideas and made changes to the code. However, in 2010 he disappeared and ceased to participate in development.
  4. First Bitcoin Transaction: Nakamoto made his first bitcoin transaction on the 12th of January, 2009. He sent them to Hal Finney, a software engineer. This transaction was a historic moment for the cryptocurrency.
  5. Domain Registration and BitcoinTalk Forum: In 2007, Satoshi Nakamoto registered the bitcoin.org domain, which has become the go-to resource for the Bitcoin community. He also created the BitcoinTalk forum where people could discuss and contribute to the development of Bitcoin.
  6. Block Finder Award: Satoshi was the first miner on the Bitcoin network during its inception. His mining activity lasted about a year, after which other members of the community took over the support of the network.
  7. Messages and Email: During his activity, Nakamoto kept in touch with other members through forums and email. In messages, he shared his thoughts and ideas regarding cryptocurrency, which allowed other developers to better understand his views.
  8. An Undeniable Legacy: Regardless of Satoshi Nakamoto’s identity, his contribution to the world of finance and technology is undeniable. Bitcoin and the blockchain protocol that he created became the basis for the development of an entire industry and made significant changes in the understanding of decentralization and digital currencies.

Quotes

Since the identity of Satoshi Nakamoto remains a mystery, it is hard to say which words actually belong to him. The following quotes, attributed to the creator of Bitcoin, were taken from BitcoinTalk, the first BTC discussion forum:

  • “Yes, we will not find solutions to political problems in cryptography, but in a few years we can win a big battle in the arms race and capture new territory of freedom. Governments are good at beating the heads of centralized networks like Napster, but true decentralized networks like Gnutella and Tor seem to be out of their reach”;
  • “Bitcoin, if we can properly explain it, is in tune with the libertarian point of view. Although I write code better than I speak”;
  • “I am sure that in twenty years there will be either a huge number of bitcoin transactions, or none”;
  • “What do you think about the symbol B with two stripes on the outside? Can we live with this logo?”;
  • “If you don’t believe me or don’t accept this, I’m sorry, I don’t have time to convince you.”

The Satoshi Nakamoto Institute website provides a glimpse into the world of Satoshi, who was still active on the internet. There you can find his letters, forum posts, code and other quotes.

Conclusion

Satoshi Nakamoto remains one of the most enigmatic figures in the world of cryptocurrencies and blockchain technology. First introducing Bitcoin in 2008, he created a revolutionary electronic money system that became the basis for many other cryptocurrencies and blockchain projects. However, the true identity of Satoshi Nakamoto remains unknown. This pseudonym leaves a sea of ​​unanswered questions. Although there is some speculation and information about him and his connections with the community, no one has been able to reliably confirm the true name of the crypto creator. Satoshi Nakamoto was actively working on the Bitcoin project in the initial period of its development, but in April 2011 he suddenly disappeared from the radar and stopped his activity on the network. The question of who made bitcoin still remains answered. Ultimately, until reliable information about Nakamoto's identity is provided, his story and motives will remain part of the mystery, adding to the aura of intrigue surrounding Bitcoin and its creator.

FAQ

Bitcoin was created by a person or a group of people under the pseudonym Satoshi Nakamoto. Nakamoto's true identity remains unknown. There are various theories and assumptions about his or their identity, but no one has been able to confirm the specific identity of BTCʼs creator.

How are bitcoins created? The answer to the question is simple. They are generated by mining. Mining is the process of solving complex mathematical problems that is performed by computers to confirm and process transactions on the Bitcoin network.

Satoshi is the smallest unit of measure for bitcoin. One bitcoin is equal to 100 million satoshis. Satoshi Nakamoto, the pseudonym of the creator of Bitcoin, was used to name this unit.

And who is the founder of Bitcoin? The true identity of Satoshi Nakamoto remains unknown. Various individuals have been speculated to be Satoshi Nakamoto, including names like Dorian Nakamoto, Hal Finney, Nick Szabo, Craig Wright and so on. However, no conclusive evidence has been presented to definitively identify any one person as Satoshi Nakamoto. The mystery of Satoshi's identity continues to be a topic of speculation and intrigue within the cryptocurrency community.

Bitcoin started in 2008 when an individual or group using the pseudonym Satoshi Nakamoto published a White paper titled "Bitcoin: A Peer-to-Peer Electronic Cash System." This document outlined the concept of a decentralized digital currency, known as Bitcoin, which would operate on a blockchain technology and enable peer-to-peer transactions without the need for intermediaries. In 2009, Nakamoto released the open-source software to launch the Bitcoin network, mining the first block (the "genesis block") and setting the foundation for the cryptocurrency ecosystem.