The Cheat Sheet

A currency in search of a ‘founder’

JINOY JOSE P | Updated on March 08, 2018 Published on May 04, 2016

bitcoin

I bet you’re talking about bitcoin.

There you go!

But it has a founder...

If you have Satoshi Nakamoto in mind, yes, you’re partially right.

Partially?

Well, no one has a clue if Nakamoto is a person or a group of geeks. The name has no face, as yet.

Oh, but two days ago one Craig Wright claimed he’s Satoshi Nakamoto...

Yes, on May 2, the Australian businessman claimed thus, but not many in the bitcoin fraternity seem to believe him. According to them, whoever claims to be Nakamoto — said to be a genius programmer and a visionary — must prove it. Now, Wright, a computer scientist of some repute, must do exactly the same. To be fair, he says he’ll do it.

How?

To the uninitiated, this is not the first time the media gives a face to the bitcoin founder. In 2014, Newsweek zeroed in on one Dorian Satoshi Nakamoto, a resident of Los Angeles County, but later the story went bust. In 2011, New Yorker dropped some hints that Michael Clear, then a student in cryptography at Trinity College in Dublin, could be Nakamoto, but he too denied it.

Now, Wright says he will post on his blog a series of articles that will prove his claim. The pieces will include documents and evidence that could be verified by the sceptics. Also, he will move a bunch of bitcoins from an old account, dating as far back as the inception months of the digital currency. This, he feels, could prove he was there when it was born.

Sounds interesting...

If you remember, Nakamoto introduced the idea of bitcoin, envisaged to be a currency without a state and based on heavy-duty computer algorithm, just after the global financial meltdown of 2007-08. The currency’s core philosophy had a deep stamp of anarchy and anger against organisations that could manipulate currencies. Each bitcoin has a unique digital address which cannot be tampered with by anyone; so if Wright produces some of the old ones, at least he could establish that he is not a newbie in the currency club.

Will that work?

Not sure, because the bitcoin community is peopled by super-crazy minds and answering their queries and concerns will really be a tall order for the suave Wright, who, from the looks of it, does not seem to be fitting into the myth that has been created around Nakamoto. Not just IT whiz kids, even the finance community and regulators are interested in the whereabouts of the bitcoin founder. Mind you, bitcoin is termed one of the most important technological innovations in finance in a hundred years; so there is natural curiosity in the world of finance and investing to “verify” the authentic owner of the invention.

But how much money are we talking about here?

As of today, the outstanding value of bitcoin stands at about $7 billion, and it’s only growing as the quest for a no-frills, no-strings-attached currency is grows across the globe. Also, there is an immediate business impact as well. One report says over $1 billion worth of venture capital has gone into bitcoin-related businesses.

Will the latest revelations affect the currency?

In fact, some people who are involved in bitcoin trading reportedly think Wright’s revelation won’t make much of a difference to the future of the currency and the so-called “open-ledger” technology of blockchain that forms the basis of the bitcoin system. But there are other issues.

Such as?

The real Nakamoto holds a kitty of bitcoins estimated to be worth $450 million. Given the near-infamous history of bitcoins — it is used by money swindlers, drug peddlers and even terrorists — the authorities will be more interested in knowing how ‘Nakamoto’ is going to deal with the money.

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Published on May 04, 2016
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