- One of the biggest mysteries in the technology world is the identity of Satoshi Nakamoto, the computer programmer who invented the digital currency bitcoin.
- Experts agree that uncovering Nakamoto’s identity could have an immense impact on bitcoin’s economics and internal politics.
- Nakamoto is believed to possess about five percent of the entire cryptocurrency. Today, that stash is worth over $5 billion.
One of the biggest mysteries in the technology world is the identity of Satoshi Nakamoto, the computer programmer who invented the digital currency bitcoin.
That’s because the name—Satoshi Nakamoto—is a pseudonym. It could represent a man, a woman, or even a group of people.
And, since the cryptocurrency was created in 2008, no one has been able to figure out who Nakamoto really is.
But beyond solving a longstanding mystery, experts agree that uncovering Nakamoto’s identity could have an immense impact on bitcoin’s economics and internal politics.
In 2008, Nakamoto published a nine-page white paper containing the first-ever mention of bitcoin, calling it a “peer-to-peer electronic cash system.”
A few months later, Nakamoto released bitcoin’s first software and partnered with developers and coders online to improve it.
This collaborative environment continued until 2011 when, without warning, Nakamoto vanished.
Before ceasing all online communication, they emailed a fellow bitcoin developer saying they had “moved on to other things.”
But here’s the catch: Nakamoto didn’t walk away empty-handed.
Sergio Demian Lerner, an Argentine researcher, has estimated that Nakamoto accumulated around a million bitcoins before disappearing.
Today, that stash is worth over $5 billion.
Power in Numbers
Matt Green, a cryptocurrency professor at Johns Hopkins University, says Nakamoto has the power to tank the currency if he wants to.
Bitcoin has a finite supply of 21 million which is expected to be reached by the year 2140.
Nakamoto’s one million bitcoins amount to five percent of the entire cryptocurrency.
“The thing about bitcoin is if you control a million of them, you have the ability to flood the market at any point. Think of them as rare baseball cards. They’re valuable because they’re rare. If somebody could dump hundreds or thousands of Mickey Mantle trading cards, rare ones, onto the market, they wouldn’t be worth so much anymore,” said Green.
Essentially, if Nakamoto chose to sell their bitcoin, they could flood the market and cause the price of bitcoin to tank.
Ben Yu, a bitcoin investor living in San Francisco, says Nakamoto’s stake in bitcoin is extremely significant.
“If bitcoin fulfills its role of becoming a global currency, than Satoshi Nakamoto would likely be the richest person in the world and also hold a proportionately higher share of the ultimate supply of bitcoin than something like the U.S. government holds in gold today,” said Yu.
Yu’s math works out. The U.S. government holds the most gold reserves of any other entity in the world, at about 8,000 tonnes.
That’s a little over four percent of the world’s total supply, less than Nakamoto’s five percent stake in bitcoin.
Some analysts believe bitcoin’s rally is only just beginning.
Kay Van-Petersen, a Saxo Bank analyst, told CNBC in May that he estimates bitcoin could hit $100,000 by 2027.
If that prediction comes true, Nakamoto would have around $100 billion.
Beyond economics, there’s also Nakamoto’s influence on politics.
The bitcoin community has been entangled in a number of internal debates over the future of the cryptocurrency.
Without a leader, the bitcoin community makes decisions through consensus. Various constituents of the community, like miners, investors and developers, get together to discuss changes. This process works, but it can take an extremely long time. It also means change is slow to come by.
“Very few major decisions that would surprise people or are controversial actually get made. That’s both strength of bitcoin, because it’s very static, and it’s also a weakness, because it can’t react and develop new features the way that other systems can,” said Green.
Nakamoto’s opinion and leadership—whether wanted or unwanted—would no doubt influence the future of bitcoin.
“I think the community may actually benefit if Satoshi did choose to come back and become a spiritual leader who could provide guidance and reconcile the community towards consensus,” said Yu.
So, Who is Nakamoto?
For now, it doesn’t seem like the real Satoshi Nakamoto is interested in coming forward.
Anonymity provides privacy, protection and peace—three things that likely appeal to the owner of one million bitcoins.
But is that really such a bad thing?
With the havoc it could wreak on the price of bitcoin and internal politics, it may be better off that Nakamoto—whoever that is—remain anonymous and inactive indefinitely.
Of course, that won’t stop people from wondering.
“Every single one of us, every technical person is curious about Satoshi. We want to know where this person came from and where bitcoin came from, because it’s kind of a miracle, this system,” said Green.
“But beyond that, we’d like to know what the future of bitcoin is. We’d like to know what is going to happen to all of those coins that Satoshi mined. If they’re gone forever, that means one thing, if they’re coming back, that means another thing. There’s probably some interest in having a person with this kind of skill back, part of the community, and contributing to it.”