NYT Report: Nick Szabo May Be Satoshi Nakamoto

A recent New York Times report brings together some interesting evidence that may shed light on the greatest mystery in

A recent New York Times report brings together some interesting evidence that may shed light on the greatest mystery in the Bitcoin world: the true identity of Satoshi Nakamoto.

In a world of virtual identities, it is still unknown if Satoshi is a single human being, a group of people or if he even exists. He is credited as the inventor of Bitcoin, first posting his creation on the P2P Foundation Forum on February 11, 2009.

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Last year, Newsweek’s bold attempt to uncover Satoshi backfired, badly. When the dust settled, few bought into their claim that Satoshi Nakamoto is none other than Dorian Nakamoto, an unemployed engineer living in Temple City, California. Newsweek and the report’s author, Leah Goodman McGrath, had unexpectedly unleashed a firestorm from the Bitcoin community.

The community rallied around Dorian, who claimed that he and his family suffered much hardship as a result of the story. Dorian became a celebrity, winning the sympathy of Bitcoiners, who donated tens of thousands toward his cause. Dorian himself flatly denied the claims, even saying that he mistakenly referred to the subject matter as ‘bitcom’ in a subsequent interview with Associated Press. He also took legal action. He eventually opened his first “bitcoin account”-ironically, with the help of the community- in order to reciprocate his appreciation.

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Newsweek valiantly attempted to defend their writer, who later sought to rebrand her work as a step toward constructive discussion and debate. The magazine still claims that “the facts as reported point toward Mr. Nakamoto’s role in the founding of Bitcoin.” In the end, it was a case of well-intended, ambitious journalism gone awry. The Newsweek investigation got overexcited from seemingly revealing comments and failed to pick up on the nuances most Bitcoiners would be aware of. In essence, the work relied on fairly shallow evidence: Dorian’s previous name, interviews with family members (apparently unsure of what was going on, but intrigued nonetheless), and the misplaced contextualization of Dorian’s comments.

The New York Times piece is written by Nathaniel Popper, who is also working on a book about Bitcoin’s history. Community reaction has been much more welcoming this time around, and is reflective of a well-researched investigation that digs deep into Bitcoin’s historical roots, philosophy and technology. It is best read in its entirety, the following points summarizing his arguments:

  • It is highly plausible (though not for certain) that Satoshi Nakamoto is Nick Szabo, a 51-year old American-born digital money guru of Hungarian descent.
  • This is a belief (quietly) shared among some of the most “deeply involved” programmers and entrepreneurs in the Bitcoin community.
  • Szabo joined Bitcoin startup Vaurum last year and repositioned it to focus on smart contracts. He reportedly left the startup after becoming nervous over public exposure. Colleagues believed that he was heavily involved in the development of Bitcoin after observing his skills and knowledge.
  • Shortly before the advent of Bitcoin, he created bit gold, a digital token system that used cryptography to obviate the need for central authorities to settle transactions.
  • After Bitcoin launched, he reportedly adjusted his bit gold post to make it appear as if it was written after Bitcoin’s release.
  • In the 90’s, he worked as a consultant for a company called DigiCash, one of the earlier attempts at digital cash.
  • Researchers at Aston University claimed “uncanny” similarities between Szabo’s explanations of bit gold and Satoshi’s descriptions of Bitcoin.
  • He had expressed libertarian views with respect to money, motivated by the 2008 financial crisis.
  • Unlike other early cryptography pioneers Hal Fiinney, Wei Dai and Adam Back, Szabo has not released correspondence with Satoshi from after Bitcoin’s 2009 release, nor has he acknowledged corresponding with him.
  • He stated in May 2011 that he, Dai and Finney were the only ones who liked Satoshi’s work, and then stated he was moving to another project. May 2011 was also Satoshi’s last private communication with Bitcoin contributors.
  • Szabo has flatly denied that he is Satoshi Nakamoto, although he does acknowledge similarities between bit gold and Bitcoin. He is apparently uncomfortable discussing the matter.

Satoshi’s true identity may not be verified until someone comes and proves ownership over the e-mail address used to publish the Bitcoin paper. Even then, the integrity of ownership remains suspect. Last September, the account was reportedly hijacked.

His identity may indeed never be revealed. Many Bitcoiners may feel more at ease with this outcome, perhaps finding it fitting that the creator of anonymous money continues to remain anonymous.

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