Satoshi Nakamoto is the pseudonym of the enigmatic person or group of people that created Bitcoin BTC -0.40% , the revolutionary digital currency that popularized the concept of decentralized, peer-to-peer transactions without the need for intermediaries like banks. Despite Bitcoin’s meteoric rise, catalyzing the development of the entire cryptocurrency market, the identity of its creator remains a mystery.

How and when did Bitcoin get started?

The inception of Bitcoin can be traced back to the aftermath of the 2008 financial crisis, a pivotal moment that exposed vulnerabilities in the global financial system. Satoshi Nakamoto introduced Bitcoin to the world in the wake of this crisis through a white paper published on October 31, 2008. The white paper, titled “Bitcoin: A Peer-to-Peer Electronic Cash System,” proposed a revolutionary decentralized financial system that would operate without the need for intermediaries like banks. This system was built upon a technology known as blockchain, which acts as a public ledger for all transactions, ensuring transparency and security.

Bitcoin's genesis block, also known as Block 0, was mined on January 3, 2009, marking the beginning of the Bitcoin blockchain. The creation of this first block was symbolic, embedding  the headline “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks” from London-based newspaper “The Times” and perhaps indicates the motivations behind Bitcoin's creation - the failure of the established financial system. Initially, Bitcoin did not have any monetary value; it was mined by enthusiasts who believed in the potential of a decentralized currency. 

The first notable transaction using Bitcoin occurred on May 22, 2010, when 10,000 BTC were exchanged for two pizzas, an event now celebrated as "Bitcoin Pizza Day," signifying the first real-world valuation of the cryptocurrency. 

In April 2011, Nakamoto sent his last known communication to Bitcoin developer Mike Hearn, stating that he had “moved on to other things” but expressed hope that it would continue to develop and grow. Since then, there has been no verifiable communication from Bitcoin’s founder.

Is there any idea as to who Nakomoto really is?

Numerous theories and candidates have been put forward as being Nakamoto’s true identity, though none have proven conclusive. Nick Szabo, a computer scientist and cryptographer, is one of the most frequently mentioned candidates. Szabo's development of "bit gold," a precursor to Bitcoin, and his extensive writings on digital currencies align closely with the concepts presented by Nakamoto. Stylometric analysis of Nakamoto's writings and Szabo's work has shown notable similarities, further fueling speculation, though Szabo has consistently denied being Nakamoto.

Hal Finney, another leading candidate, was a computer scientist and a prominent member of the cypherpunk community. He was the recipient of the first Bitcoin transaction from Nakamoto, and his technical expertise and early involvement with Bitcoin make him a plausible candidate. Some believe Finney could have been either Nakamoto or closely collaborated with him. However, Finney denied being Nakamoto before his death in 2014.

Dorian Nakamoto, a Japanese-American man living in California, briefly became a candidate primarily because of his name and background in engineering. In 2014, a Newsweek article identified him as Bitcoin's creator, citing circumstantial evidence and a statement he made that was interpreted as a confirmation. However, Dorian Nakamoto has vehemently denied any involvement with Bitcoin, claiming he had never heard of it before the article was published.

Craig Wright, an Australian computer scientist, has publicly claimed to be Satoshi Nakamoto. He has presented technical information and documents he claims prove his identity. Despite these assertions, many in the cryptocurrency community and independent investigators have found inconsistencies and fabricated evidence in Wright's claims, leading to widespread skepticism. A U.K. judge also ruled that Wright is not Nakamoto.

Dave Kleiman, a computer forensics expert and early Bitcoin enthusiast, is also considered a potential candidate. Some believe he may have collaborated with Craig Wright or others in the creation of Bitcoin. Legal documents and emails suggest a possible connection between Kleiman and early Bitcoin activities, but Kleiman passed away in 2013, and definitive proof linking him directly to Nakamoto's identity has not been established.

Wei Dai, the creator of b-money, another precursor to Bitcoin, is occasionally mentioned as a candidate. Bitcoin's white paper references Dai's b-money, and his work aligns with Nakamoto's ideas. However, Dai has denied being Nakamoto, and there is no direct evidence connecting him to the creation of Bitcoin.

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Lastly, British cryptographer and Blockstream CEO Adam Back has also been put forward as the true identity of Satoshi Nakamoto. Back was an early pioneer of bitcoin’s proof-of-work consensus algorithm. Back has repeatedly denied that he is Nakamoto, though he was in touch with Nakamoto via email in Bitcoin’s early history.

Despite extensive investigation and analysis, the true identity of Satoshi Nakamoto remains one of the greatest mysteries in the tech world, with each candidate offering intriguing, yet ultimately inconclusive, connections to the elusive creator of Bitcoin.

How have investigators tried to determine Nakamoto’s true identity?

One of the main ways investigators have tried to uncover Nakamoto’s identity is stylometric analysis, or analysing Nakamoto’s writings and communications to find distinct phrasing, style, grammar or other linguistic quirks and to match them with another known person. While Stylometric analysis has provided certain clues, no definitive match has been found, and Nakamoto’s writings feature common spelling patterns and phrasing of both British and American English.

Another is blockchain analysis, where researchers have scrutinized the early Bitcoin blockchain to track the movement of coins believed to be mined by Nakamoto. By analyzing the mining patterns and the blocks mined in the early days, they have tried to identify any associated addresses and trace any potential transactions or patterns that could provide clues about Nakamoto's identity.

Others have examined the timestamps and IP addresses associated with Nakamoto's early Bitcoin transactions and communications. By analyzing the geographical distribution of these IP addresses, they hope to pinpoint a possible location or region where Nakamoto might have been based. Such analysis has also proven inconclusive, with various theories pointing to Nakamoto being based in the U.S. or the UK.

Another avenue of investigation is into the metadata of Bitcoin’s whitepaper in search of clues pointing to the identity or location of its author.

What do we know about Satoshi Nakamoto?

What we do know is that Satoshi Nakamoto published the Bitcoin whitepaper and created Bitcoin.

We know that based on their spelling patterns, he used a mix of common British and American spelling. We also know that due to the amount of early Bitcoin mined by the Bitcoin creator, Nakamoto would be considerably wealthy at today’s prices. 

Analysts estimate that Nakamoto’s BTC holdings could be in the neighbourhood of 600,000-1.1 million, none of which has been moved or spent aside from 10 BTC Nakamoto sent to Hal Finney in January 2009.

Impact of Nakamoto's Invention

Nakamoto's identity, whether an individual or a collective, has remained one of the most elusive and enduring mysteries in the cryptocurrency space, sparking endless speculation and investigations, yet no conclusive evidence has surfaced to unveil the true persona behind the groundbreaking digital currency. 

While the identity of Satoshi Nakamoto may never be fully uncovered, their contribution to the world of finance and technology is indisputable. Bitcoin continues to thrive, and has inspired a wave of innovation across digital currencies and peer-to-peer payment systems.