In the words of Wired magazine, it’s “one of the most stubborn mysteries of the 21st century”: Who is Satoshi Nakamoto?
Satoshi Nakamoto is the pseudonym used to refer to the creator of bitcoin, which is the digital currency that has taken the financial world by storm.
The concept can be hard to grasp, but in the simplest terms, it’s a self-regulating, electronically created currency that gets traded anonymously and without a centralized bank or bookkeeping authority. (For a broader primer on bitcoin and its history, check out this post from NPR’s Emily Siner.)
Nakamoto’s identity has mystified many a bitcoin fan and tech reporter. Various news outlets (most infamously Newsweek) have unsuccessfully tried to demask the elusive person/people behind the phenomenon.
The latest attempt came this week from Wired magazine. Except this time, the story based its findings on numerous recorded links between the man and the identity of Nakamoto, through leaked emails, old blog posts and public documents. And then, just hours later, a twin story from tech website Gizmodo: more emails and documents, independent research, similar findings.
Their shared conclusion: It’s probably a man named Craig Steven Wright, an Australian entrepreneur and academic, working with American computer forensics expert David Kleiman until his death in 2013.
And then, another few hours later: reports from Reuters and The Guardian that Australian police have raided Wright’s home and office in Sydney. The authorities told The Guardian that the execution of search warrants was “to assist the Australian Taxation Office,” but that the “matter is unrelated to recent media reporting regarding the digital currency bitcoin.”
A lot remains unknown and unconfirmed in this saga, warranting a dose of skepticism from the tech community and the reporters themselves, who admit that the whole trail of new Nakamoto evidence could be an elaborate hoax, possibly by Wright himself.
And why does it matter anyway? Wired puts it this way:
“If Wright is bitcoin’s creator, the revelation of his work carries more importance than merely sating the curiosity of a few million geeks. The bitcoin economy would need to consider that if his million-bitcoin trust unlocks in 2020, Wright and those to whom he may have assigned hundreds of thousands of bitcoins would be free to sell them on the open market, potentially tanking the cryptocurrency’s price; debates within the bitcoin community (…) may look to long-lost Nakamoto for guidance; the world would have to grapple with the full scope of Wright’s vision when he unleashes the result of his companies’ post-bitcoin research. (…) And the intellectual history of cryptocurrencies would be forever rewritten.”
Bitcoin over recent years has grown up as a cryptocurrency into a financial force to be reckoned with. As its popularity has grown (along with its price) and more businesses have opened up to accepting it for payment, tax agencies around the world had to decide how to handle this intangible financial stream.
The Internal Revenue Service ruled last year to treat virtual currencies as property, meaning profits get taxed at the capital-gains rate. Reuters reports that the Australian authorities made a similar call after “considerable” debate and bitcoin has faced some pushback in the country:
“Australia’s major banks announced in September they were closing accounts of bitcoin companies, forcing at least 13 digital currency providers out of business in response to tougher rules on money laundering and terrorism financing.
“A Reuters investigation in October found that Australian businesses were turning their backs on bitcoin as the banks’ move accelerated a trend by mainstream businesses to drop the currency.”
The big thing about Wright, if he is Satoshi Nakamoto, is that he holds a massive stash of bitcoins, according to Wired and Gizmodo, worth nine-figure currency sums of the more familiar hard kind.
Gizmodo’s story references two meetings of Wright’s attorney and the Australian Taxation Office, one of which included Wright himself, as “Wright appears to have been trying to persuade the Australian government to treat his Bitcoin holdings as currency, as opposed to an asset subject to greater taxation.”
According to the report, present at one of those meetings was Wright’s accountant John Chesher: “When asked if he had ever told the Australian Tax Office that Wright was in possession of a Satoshi-sized Bitcoin sum, he replied, ‘I may have.’ ”
Wright and his family did not appear to be at home at the time of Wednesday’s raid. A man who identified himself as the owner of Wright’s rented home in Australia told both Reuters and The Guardian that the family was in the process of moving to Britain.
You want to know what is really going on these days, especially in Colorado. We can help you keep up. The Lookout is a free, daily email newsletter with news and happenings from all over Colorado. Sign up here and we will see you in the morning!