Satoshi Nakamoto is a pseudonym and the person or persons behind it have not been identified even after more than 12 years.
Bitcoin has undoubtedly laid the foundation for the rapid development of blockchain technology as we know it today. It all began shortly after the financial crisis of 2008, when the now famous white paper “Bitcoin: A Peer-to-Peer E-Cash System” by Satoshi Nakamoto was published on October 31st in a cryptography forum in response to the shortcomings traditional, fractional financial system that led to the crisis.
This was not only the beginning of a new asset class, but also the beginning of a conundrum or riddle, as Satoshi Nakamoto is a pseudonym and the person or persons behind it have not yet been identified, even after more than 12 years.
A few days after the whitepaper, Nakamoto registered the project on SourceForge, the open source code platform, and on January 3, 2009, the first bitcoin block called the Genesis block was mined, which gave Satoshi the first 50 bitcoins of the 21 million, that will ever be created.
In this block, Nakamoto posted the message: “The Times Chancellor 03 / Jan / 2009 on the verge of a second bailout for banks,” a London Times headline that day that was interpreted as both a timestamp and criticism of the traditional financial system .
Regardless of who Satoshi Nakamoto really is, he made the first Bitcoin transaction on January 12, 2009, sending 10 BTC to developer Hal Finney, who was actually one of the candidates for Satoshi.
To understand why Satoshi Nakamoto chose a pseudonym, it’s a good idea to remember the basic idea behind Bitcoin. The first sentence of the Bitcoin whitepaper reads as follows: “A pure peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.” makes it clear that the basic idea of the network is decentralization.
If Satoshi had chosen to reveal their true identity, they would have become the central element in a decentralized system. In order not to compromise the concept of decentralization, Satoshi likely chose not to be in the limelight.
Over the years several attempts have been made by various online communities to decipher the true identity. Various language and behavioral studies have been conducted which led some people to believe that Satoshi lived in the United Kingdom, as suggested by their flawless written English or the fact that they occasionally used quintessentially British phrases. Other people analyzed the posting patterns to suggest that they must live in eastern or central time zones.
Other researchers suggested that Satoshi just couldn’t be just one person: her expertise in various fields, including cryptography, computer science, economics, and psychology, could support the hypothesis that Satoshi is more than one person.
The two top candidates discussed in the past were Hal Finney and Nick Szabo. Hal, who died in August 2014, was an early bitcoin user and received the first bitcoin transaction from Satoshi. Nick Szabo is a blockchain pioneer and founder of “Bit Gold”, one of the earliest attempts to create a decentralized digital currency in 1998. However, Nick has denied that he is Satoshi.
Many hypotheses and rumors have affected it. Best known is Elon Musk, who denied being the inventor of Bitcoin. According to Jerry Brito, director of the cryptocurrency research group Coin Center, the real Nakamoto should have a key connected to Bitcoin’s so-called Genesis Block – the beginning of the public ledger of Bitcoin transactions called the blockchain.
At the moment, none of the self-proclaimed inventors could conclusively prove that they are the thought leaders behind Bitcoin. So there is still no consensus on who Satoshi Nakamoto is.
(Shankar Sharma is a co-founder of First Global.)
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