This is the feature article forIssue 20.
Explaining Bitcoin to a luddite is like explaining the plot of an action-drama movie. Failing exchanges! “Overnight” millionaires! Bank robberies! Drug-busts! World-changing innovation! Government espionage and fortunes made and lost! One of the most interesting aspects is the superhero-like protagonist: our system’s very anonymous creator, Satoshi Nakamoto.
Satoshi Nakamoto is thought to be a pseudonym for the unknown “Father of Bitcoin”; in Japanese, Satoshi Nakamoto roughly translates to “thinking clearly inside the foundation.”1 For the purpose of this article, Satoshi will be referred to as a male.
His preference for privacy is his hallmark. He used e-mail addresses and web-sites that were untraceable. In 2009, he produced his famous white paper in flawless English and invited interested developers to assist him with improving his code, written in C++. In April, 2011, considering his work strong enough to pass onto others, he announced he was “moving onto other things” and has not been heard from since.2
Nakamoto’s desire for pure anonymity has been understood and should be respected; we live in a world where disruptive innovation that challenges the interests of governments and big business is eradicated. Just ask Julian Assange, Edward Snowden and Kim Dotcom, or the creators of e-Gold, who were charged with money laundering and the operation of an unlicensed money transmitting business and quickly shut down.3
Human nature is what it is. We love a great masked-crusader story, and some consider it natural to seek the truth4, no matter the consequence. Many publications attempt to discover the man behind Bitcoin, including The New Yorker, Fast Company and Vice Magazine. All failed, and the question remained: who is Satoshi Nakamoto? We ended up with a few clues: according to his P2P foundation account details, he is a 37-year-old male living in Japan. His choice of language is English, but his spellings and colloquialisms shift from American to British, meaning he could be more than one person. When he responded to posts and e-mails, they would arrive at different times, meaning he could exist in different time-zones. What wedo know is that Satoshi is highly intelligent, economically and mathematically brilliant, well-versed in cryptography, a capable (but not expert) programmer, and likely has a background in academia, as his white paper is written in an academic style.
Given what happens to disruptive innovators in today’s world, Satoshi Nakamoto had good reasons to stay anonymous. Developers who worked alongside him, and the community that flourished with his gift, largely respect this desire. Even if personal safety isn’t what Satoshi is concerned with, and it’s more modesty, or dislike of attention, or just personal preference, Satoshi’s desire for privacy has always been clearly stated. It is ‘his’ wish. In the end, his identity should only matter to those who are looking to bring him down or hold him accountable to the actions they consider detrimental to their own way of life. Apart from being unkind and disrespectful, it is simply dangerous to expose people of this magnitude. The Bitcoin community respected this wish from the start. We didn’t dig much; rather we understood his/her/their desire and, understanding the uselessness of gossip, we turned our focus to Nakamoto’s incredibly innovative concept instead. As Eleanor Roosevelt famously said, “Great minds discuss ideas, average minds discuss events, and small minds discuss people.” Bitcoiners are idea-driven people.
Some of the world’s most brilliant minds are attracted to Bitcoin; even if they don’t particularly support it, they are intrigued by its development and growing pains.
We live in a world where people can simply vanish for speaking out against infrastructures, institutions, or governments we consider damaging to ourselves, our environment, and our way of life. Most discussions about Satoshi Nakamoto occur when explaining the Bitcoin story to new adopters: “You mean we don’t know who created it? How is that possible!” Yes, it is neat, isn’t it? When we agree with the intrigue of the anonymous creator and get back to the benefits of Bitcoin, the topic eventually disappears from discussion, and this is where the real magic begins.
We humans are truly incredible beings. We are so very capable of moulding the world around us into what we desire. We accomplish incredible feats by focusing our attention and power into what needs to be done – individually and collectively. It has been said that the catalyst for the ‘re’invention of digital cash (a.k.a. Bitcoin) was the horrific 2008/2009 American Subprime Mortgage Crisis and subsequent worldwide financial crisis5. Confidence in fiat (government issued) currencies came into question with practices like quantitative easing by the Federal Reserve and other central banks, private or public reserves, or governments themselves. Essentially, quantitative easing is economics lingo for ‘let’s create more money, thereby devaluing all existing money ever-so-slightly (this is what inflation is), and retain the newly minted money for our own use’ – usually to spend on propping up the economy. You can see how that would appeal to governments and central banks the world over. However, the public was soon witnessing major a European sovereign debt crisis and an all-out global recession, and it hit home.
Humans lost their houses, their pensions and their dignity, while the indifferent and ego-driven ultrarich “banksters” and instigators in the global meltdown collected their bonuses and watched their companies collect trillions of dollars in bailout funds.6 The complete lack of respect for the non-rich became more visibly apparent during this time. One example of this clear arrogance and lack of respect for human dignity was the infamous $50 ‘bonus’ by one Koch brother, a member of one of the of richest billionaire families in the United States – to his trusty doorman for a years’ worth of work.7 What is wrongwith these people? Our lack of respect for each other seems to have reached a pinnacle.
However, some of us are awakening to the dangers of our current financial and banking infrastructure and policies, understanding that the systems we have in place are not sustainable, practical or beneficial to the advancement of humankind. The entire financial system seems, in oversimplified terms, to accrue a disproportionate share of all wealth to the richest and best connected. Niall Ferguson, in his book “The Great Degeneration”, explains that, since the 1970’s, real income (income adjusted for the effects of inflation over time) for the ever-shrinking middle class has gone unchanged at best and decreased at worst, according to how you crunch the numbers. In our western capitalist system, most wealth generated through the computer and internet eras has accrued to the wealthiest 1 and 0.1 of individuals, whose real incomes and wealth have risen up to 10 times in that same period. For example, if your family was moderately wealthy in the 1970’s, chances are you and your brood are now ten to one hundred times richer today, while your middle class brethren, on average, haven’t budged. Our system simply cannot continue as is without a very large number of people realizing that this is grossly – systemically – unfair. Where we once had a thriving and prosperous middle class, we now have an alarmingly large swath of society trapped as poor and working poor, alongside a stagnant middle class. There is potential and power in each one of us, but the fruits of our labours are being systematically sent to the the top, so the rich and ultra-rich can do whatever the rich and ultra-rich do to feed their collective materialism and ego. Thankfully, however, there are incredible human beings who choose to dedicate their time, energy and resources to pursuits other than materialism and ego. Enter Bitcoin.
The Bitcoin community is filled with these types of individuals: people who work to build sustainable infrastructures so we may live in a win-win environment and support the matters in our lives that are of true significance: the environment, which sustains our physical bodies; safety and freedom from fear, which sustains our emotional and spiritual well-being; and access to knowledge and the pursuit of purposeful work, which sustains our incredible minds and souls. The systems we knowingly or unknowingly choose to engage in now immensely limit our potential as individuals and society as a whole. They do not support the development of great minds.
Part of the problem with our current global culture is the power of the media to distract us from the work that we need to accomplish to create win-win environments. We live in a world where Justin Bieber’s deposition video is our top trending topic; where we riot violently over lost hockey games and not over the inclusion of toxins in our personal care products8, dangerous Monsanto policies, or horrific acts of genocide or war that rage all over the world. Is it that we don’t care? Or is it that we are so distracted by the latest gossip that we are literally amusing ourselves to death?
Because we are feeling the pressure of our broken economic system(s), it’s becoming impossible to ignore the promise of something like Bitcoin. This innovation offers an alternative system – one that is a decentralized, network-based, cooperative way to transfer any amount of value, to anyone, anywhere, at anytime, and for a fraction of the current costs. In a world where Western Union is the most recognized logo, you can imagine the possibilities for cost-savings! The true potential of this innovation is for the 6 billion of the world’s poorest: the underbanked.
But, remember, we are distracted. Of 100 people personally polled, most people could not actually explain or define Bitcoin to me, but they could tell me all about how it “went bankrupt in Japan”, how “Bitcoin’s CEO committed suicide”, and how “the bank got robbed and they went under.” Like it or not, the majority of people are still convinced by 30-second television bits that focus on the 1 of “bad” news. And why would these news clips focus on anything else? Traditional journalism, after all, is geared towards selling copies, written by non-experts in the fields they generally report on, to a population of media consumers who expect ‘bread and circus’ from their media: shiney scandals, controversies, and flashy doom and gloom headlines; if it bleeds, it leads. Bitcoin challenges our current infrastructure and, on the whole, could stand to rewrite the rules on wealth distribution and wealth transfer. The hyper-powerful and ultra-rich owners/executives of both the financial sector and media9 do not support anything that challenges their position. They are afraid of what Bitcoin heralds: a disruption of their power base.
There is a lot of work that needs to be done to reverse the trend of wealth inequality, and distractions will always try to deter us. However, we must remain in constant effort to convert small minds to great minds and unleash the incredible potential in all of us. Focus not on what is served, bleeding, on the platter of conventional media, but instead seek to find true innovation and help improve the world in whatever way you can.
One such distraction that folds all of these issues together is the recent Newsweek article by American freelance journalist Leah McGrath Goodman and her team of forensic journalists. Newsweek itself is another sad story, exemplifying the folly of traditional media in the internet age. The magazine was recently purchased for $1USD in exchange for absorbing Newsweek’s considerable financial liabilities by the late Sidney Harmon, a pioneer in the audio speaker industry10. Harmon hoped to revive the magazine’s reputation as a source of quality information. Leah and her team were assigned to the considerable task of regaining readership, and fast; the cover story was theirs to present to the world. They needed something that would get Newsweek flying off the shelves and create massive discussion. What was the most controversial, mysterious and misunderstood topic that would attract readers young and old, brilliant and distracted?
Bitcoin, of course. But it had to be accessible. Another story on “mining” doesn’t sell. The masses can’t grasp it. As we know from Facebook and Twitter analytics, celebrity sells. Gossip sells. And we humans have always had a fascination with masked characters. “Unmask Satoshi Nakamoto”, a little voice must have said. “It will sell.”
Leah’s search for the truth quickly trumped the desire for anonymity Satoshi Nakamoto expressed for years and is yet another clear indication that we are collectively failing to respect each others’ wishes, even when they are clearly and repeatedly expressed: “It’s natural to want to know who is behind Bitcoin, even if he is no longer involved. As a journalist, I thought I could clear it up.” And on she went, just like so many others who exist in the world right now, with her outright disregard for Satoshi Nakamoto’s preference for personal privacy. It should be stated that her concern for his safety, given he is estimated to host a fortune equivalent to approximately $400M in bitcoin, was not a concern for her, either: “I’m the finance editor for Newsweek. I cover Wall Street. The people that I write about buy penthouses and make a great deal more money than what we’re talking about with Satoshi.”12
The quest for truth is an honourable one, but at what point does it trump the value of respect for privacy?
Leah moved forward. She and her team sifted through public and “archives that [Leah] doesn’t even use”11 “and “crossed off …all the leads we could find. We worked out all the possibilities and narrowed it down to the strongest lead.”11 Leah likens her investigative and forensic to a process of elimination: looking for reasons why one cannotbe someone instead of looking for reasons why one can be. “It’s all about eliminating candidates… it’s looking for things that will cancel people out.”12 Their strongest lead was one Dorian Prentice Satoshi Nakamoto (born Satoshi Nakamoto), a Japanese-American, based in California. It should be noted that Leah later defended her invasion of privacy by stating that all the information she published was “publically available”, even though she also expressed that working with her forensic journalist team gave her access to archives she was otherwise not exposed to.11
Leah attempted to speak with Dorian many times and failed. She reached out to his family members and eventually obtained Dorian’s e-mail address via a company who supplies Dorian with model train parts for a hobby he enjoys. She connected with him regarding his train hobby, but when her questions shifted towards Bitcoin, he disconnected. Leah persisted, tracking down Dorian’s house through publicly-available means and appeared in his driveway, unannounced and clearly unwelcome. He immediately phoned the police, which she thought odd. Eventually, he emerged, looking “annoyed”. In their 30-second conversation – which was not recorded, by the way – he allegedly responded to Leah’s question about his involvement with Bitcoin by saying “I am no longer involved in that and I cannot discuss it. It’s been turned over to other people. They are in charge of it now. I no longer have any connection.”
Bingo. Newsweek had what they needed for their scoop. Dorian Prentice Satoshi Nakamoto was “undeniably” the creator of Bitcoin. All from an unconfirmed, unrecorded, offhand comment from a man with whom she had never before spoken in person.
According to Leah’s story, Dorian Prentice Satoshi Nakamoto (Satoshi Nakamoto) is an engineer, mathematician and a libertarian. He has no public record of being a cryptography expert, and he has a mediocre handle on the spoken English language. Dorian is notorious and obsessive about his privacy. Dorian enjoys the mountains, the sea, and model train sets. His brother mentions that Dorian and will never admit to “starting Bitcoin”. It makes you wonder: how many prank calls do you think that family received from bitcoin techies asking if he invented Bitcoin? We’re talking about some of the brightest minds in the tech sector. Chances are that with ‘Satoshi Nakamoto’ contained within his full name, Dorian had been emailed, called, hacked, and stalked before; no wonder he called the police. Wouldn’t you?
Leah’s story dug deep into Dorian’s life. It exposed personal health and financial problems, and also included a picture of his house, his car and his license plate. Leah wanted to craft an image for the world of a humble genius that created a landmark innovation. She did. She showed us everything about a ‘rich’ man so humble that he wouldn’t dip into his supposed $400M USD bitcoin stash to prevent the foreclosure of his house. On March 6th at 6:05 AM EST, her story was released to the public.
The fallout from this “news” was loud. At first, many in the Bitcoin community challenged her accusations. Inconsistencies appeared immediately: if this man was so obsessive about his privacy, why would he use his own name? If this man had access to over $400M USD, why would he allow his family and his own health to suffer, to the point of a foreclosed house? If he is Japanese, why has Bitcoin never been translated into his mother tongue? The development of Bitcoin requires incredible comprehension of cryptography, which Dorian does not appear to have. The original Satoshi white paper is written in crisp, academic English, and Dorian’s English is not at that level. The inconsistencies continue13, and the strength of Leah and her team’s argument fell apart faster than the Lehman Brothers.
Dorian even disputed this accusation himself, telling the Associated Press “I’m saying I’m no longer in engineering. That’s it. And even if I was, when we get hired, you have to sign this document, contract saying you will not reveal anything we divulge during and after employment. So that’s what I implied. It sounded like I was involved before with Bitcoin and looked like I’m not involved now. That’s not what I meant. I want to clarify that.”14
The Bitcoin community saw these discrepancies in her assertions immediately, and some conversation developed over the veracity of the argument. Dorian, who may or may not be theSatoshi Nakamoto, was unceremoniously forced under the public microscope by a reporter trying to fit a square Satoshi into a round Nakamoto. They also questioned her journalistic methods; Dorian was singled out by Newsweek as the last man standing with the correct name in a process that ruled out everyone else. The remaining discrepancies seem forced into place with flawed logic with the starting assumption that Dorian was guilty until proven innocent; the court of public opinion seems backwards in this case. However, these discussions died down quite quickly. Disappointment with the articles’ unnecessary and invasive details of Dorian’s private life quickly took its place via Twitter.
- So you had to show a picture of his house and license plate when the man is worth a fortune. Disgraceful.
- Serious question: why would you post his address on the internet when you know he clearly wants to be left alone? Did you ever consider that posting his address, and that he has $400m could be a bad thing?
- Why did you publish the photo of home & car? What did doing so add to the story? Was there any discussion of risk to Nakamoto?
- Is there a reason why you needed to include such intimate details about this man’s life in the article?
- Why don’t you post an article with a picture of your house, and your address, and tell everyone you have 400m inside?
- Disgraceful invasion of Satoshi’s privacy. MOST UNETHICAL ARTICLE EVER. You ruined his life. You must be proud!
- I wanted to know about the person, not what his home address was, his license plate, or medical issues.
Even those in the Bitcoin community who have been obsessed with discovering Nakamoto’s identity for years did not feel the answer was worth violating the privacy of a clearly very private person/entity. Michael Goldstein of the Satoshi Nakamoto Institute explained, “If someone was telling you they don’t want to be known, and you report a story about that person’s life and put up a picture of him and his home, that’s a bit f-cked up.”15
Of course, the bad-apples – which exist in every industry and community – resorted to vicious ad-hominem attacks, calling for Leah to be fired, and in one case, burned. Overall, the Bitcoin community’s voice was one of concern for Dorian Nakamoto’s well-being and safety, and deep disappointment over the lack of journalistic integrity by Leah and her team, especially with her knowingly and continuously invading the privacy this man so clearly desired and cherished.
Of course, some vitriol was spewed from Leah’s side, as well, accusing the community of being prepubescent. But even this back-and-forth childish ad-hominem attacks did not last long. We realized quickly that this reaction, this sensationalist publicity or “pressititution” was exactly what Leah and Newsweek had hoped to gain: attention. So we turned our sights to what we do best: focusing on the positive. Andreas Antonopoulos, Chief Security Officer for Blockchain and noted Bitcoin entrepreneur and cryptography and security expert lead the way gracefully, with what great minds do best when it comes to gossip: “Ignore them. Don’t feed the speculation.”
Within the hour, Andreas rallied the community together. “Let’s show them what the Bitcoin community is all about!” He created a charitable wallet, wherein our community could contribute whatever we could to send to Dorian Nakamoto to “say sorry” for all of this.
Donations began pouring in from around the world. You see, for most of us in the community, it doesn’t matterwho the creator of Bitcoin is. It is irrelevant. We are ALL Bitcoin. Without all of us participating together, putting our faith and belief in this system, Bitcoin does not exist. It needs all of us working together, building and maintaining a trustworthy network to survive and thrive. We are all taking a chance on a new innovation that many won’t touch due to fear. And, just like Satoshi, we understand the potential risks of being involved in something that so boldly challenges our broken financial systems and current infrastructures. Together our community reinforces the importance of this technology and we keep each other focused on the end goal: adoption.
Our small minds, focused on the person, soon regrew to remembering the idea. We are all satoshi. Our Twitter names reflected this. A new hashtag, “#wearesatoshi” showed the world that our focus is not on who, but on what. And we are people who stand behind and support whomever needs it, whether it’s a student calling home for money17, the homeless18, or even a struggling man living in a humble home in California. In the end, this is what Bitcoin is about: coming together to empower one another and contribute to the earth each one of us deserve to enjoy.
Together, we are. By the end of March, Dorian Satoshi can expect a charitable gift from the Bitcoin community to the tune of approximately $20,000 USD19. If he declines it, it will be sent to a charity of his choice. If he does not choose a charity, it will be sent to the Electronic Frontier Foundation, a not-for-profit that works to ensure that rights and freedoms are enhanced and protected as our use of technology grows.
Leah has not yet apologized for her lack of respect for Dorian’s request for privacy. She has not apologized for publishing his personal information, clearly knowing that was not his preference. She says that Newsweek’s “graphics department” made the final decision on publishing pictures of his house, car, license plate and person. Did she not take them? While It is admirable that Leah is so dedicated to finding – and eating – the truth, and we must remember the importance of respecting our fellow citizens, whatever their wishes may be. Leah, we respect your search for the truth, but we are very disappointed with your methodology and your inappropriate invasion of Dorian Prentice Satoshi Nakamoto’s privacy. It was completely and utterly unnecessary.
Dorian: we, the Bitcoin community, are sorry for the hassle this investigation has put you through. Whether you are or are not the “real” Satoshi Nakamoto is irrelevant. We wish you all the best and hope that our contributions can help in whatever way you choose to receive or allocate them. Please do not align this experience with Newsweek with the Bitcoin community.
Satoshi Nakamoto: Whoever you are, thank you for what you’ve given us. It must be exciting to watch such co-operation unfold from your idea and the team you motivated to create.
Bitcoin community: there is more work to be done. Ignore the noise. Expect these distractions, but steer around them. Keep your blinders on. Follow the great minds that lead the way. We are changing the world, and we invite everyone who is willing to join us. Focus on educating those around you, bringing local businesses on board with the amazing benefits bitcoin offers, and otherwise developing your knowledge and increasing adoption anyway you can. Stick with other great minds, and let’s get to work.
1. “Motherboard Motherboard.” Motherboard. Web. 19 Mar. 2014.
2. “The Crypto-Currency.” The New Yorker. Web. 19 Mar. 2014. <http://www.newyorker.com/reporting/2011/10/10/111010fa_fact_davis>.
3. “E-Gold Charged with Money Laundering.” E-Gold Charged with Money Laundering. Web. 19 Mar. 2014. <http://www.securityfocus.com/news/11462>.
4. “Bitcoin Founder Unmasked? Newsweek Cover Story Author Stands by Story after Dorian Satoshi Nakamoto’s Denials.”CBSNews. CBS Interactive. Web. 19 Mar. 2014. <http://www.cbsnews.com/news/bitcoin-founder-unmasked-newsweek-cover-story-writer-stands-by-story-after-dorian-satoshi-nakamotos-denials/>.
5. “The Definitive History of Bitcoin | Visual Capitalist.” Visual Capitalist. Web. 19 Mar. 2014. <http://www.visualcapitalist.com/the-definitive-history-of-bitcoin>.
6. “Bailed out Banks.” CNNMoney. Cable News Network. Web. 18 Mar. 2014. <http://money.cnn.com/news/specials/storysupplement/bankbailout/>.
7. “Koch Brother Tips Doormen $50 FOR THE WHOLE YEAR at His Luxurious Park Avenue Building.” – Democratic Underground. Web. 19 Mar. 2014.
8. “‘Dirty Dozen’ Cosmetic Chemicals to Avoid.”David Suzuki Foundation. Web. 19 Mar. 2014. <http://www.davidsuzuki.org/issues/health/science/toxics/dirty-dozen-cosmetic-chemicals/>.
9. “Who Owns The Media? The 6 Monolithic Corporations That Control Almost Everything We Watch, Hear And Read.” The Economic Collapse. N.p., n.d. Web. 19 Mar. 2014.
10. Pompeo, Joe. “Newsweek Sells For $1 To Stereo Equipment Mogul Sidney Harman.”Business Insider. Business Insider, Inc, 02 Aug. 2010. Web. 19 Mar. 2014.
11. “Bitcoin Founder Unmasked? Newsweek Cover Story Author Stands by Story after Dorian Satoshi Nakamoto’s Denials.” CBSNews. CBS Interactive, n.d. Web. 19 Mar. 2014.
12. “Leah McGrath Goodman CNN Interview.” YouTube. YouTube, 07 Mar. 2014. Web. 19 Mar. 2014.
13. “The Newsweek Credibility Matrix.” The Newsweek Credibility Matrix. N.p., n.d. Web. 19 Mar. 2014.
14. Press, By Tami Abdollah Associated. “LA Sheriff Backs Newsweek Quotes of Nakamoto Visit.” ABC News. ABC News Network, n.d. Web. 19 Mar. 2014.
15. Greenberg, Andy. “Outrage, Disbelief as Bitcoin Creator Outed.” MSNMoney. N.p., n.d. Web. 19 Mar. 2014.
16. “As Anger Dies Down, Leah McGrath Goodman Continues to Defend Her Story.”NewsBTC. N.p., n.d. Web. 19 Mar. 2014.
17. “The Verge.” The Verge. N.p., n.d. Web. 19 Mar. 2014.
18. “Sean’s Outpost.” Seans Outpost. N.p., n.d. Web. 19 Mar. 2014.
19. “Bitcoin.” Andreas: I’m Fundraising for Dorian Nakamoto :. N.p., n.d. Web. 19 Mar. 2014.
Victoria is a partner at Bitcoin Strategy Group, and a contributor to Bitcoin Magazine, CoinDesk and CoinTelegraph. Victoria helps Bitcoin businesses with community development and marketing.