Why You Should Believe This Guy Is Bitcoin’s Creator (and Why You Shouldn’t)

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This morning, Australian computer scientist Craig Wright came forward to claim the mantle of Satoshi Nakamoto, the mysterious pseudonymous inventor of the decentralized cryptocurrency Bitcoin. If you recognize Wright’s name, it’s because he was outed last December as (maybe, probably) Nakamoto in simultaneous investigations published by Wired and Gizmodo — and then quickly dismissed when holes in the story immediately started to emerge.

The main method of verifying Wright’s identity as Nakamoto — who wrote the white paper on Bitcoin’s underlying system but stopped working on the project in 2011 — is through the use of cryptographic keys. Each Bitcoin transaction generates corresponding keys, so for the earliest Bitcoin transactions Wright should hold the keys. In a blog post published earlier today (agonizingly titled “Jean-Paul Sartre, Signing and Significance”) Wright went through a step-by-step process by which he outlined the process of key verification.

The Economist, which, along with the BBC and GQ, was given advance notice of Wright’s coming-out, wrote of the key verification:

Such demonstrations can be stage-managed; and information that allows us to go through the verification process independently was provided too late for us to do so fully. Still, as far as we can tell he indeed seems to be in possession of the keys, at least for block 9.

Block 9 is one of the earliest bitcoin transactions, tracked in a public ledger called the “blockchain.” The Economist is careful to note that while Wright’s evidence is convincing, it’s not quite enough for the magazine to say definitively that Wright is Nakamoto: “We are not so sure,” the editors write, bluntly.

Among other reasons to doubt Wright: Some experts don’t think he’s, well, smart enough to be Nakamoto. “When Mr Wright was outed, experts called his published writings unremarkable,” The Economist writes. They later put it somewhat more delicately: “When interviewed in person, Mr Wright was often hard to follow, but he clearly seemed to know what he was talking about.”

But Wright is smart enough to have convinced other major Bitcoin players of his legitimacy — including Gavin Andresen, heir to Nakamoto’s position as lead developer of Bitcoin. In a short blog post, Andresen wrote:

I was flown to London to meet Dr. Wright a couple of weeks ago, after an initial email conversation convinced me that there was a very good chance he was the same person I’d communicated with in 2010 and early 2011. After spending time with him I am convinced beyond a reasonable doubt: Craig Wright is Satoshi.

(Andresen also claims Wright’s demeanor seemed to match up with the personality of Satoshi, which, well, sure; we’ll have to take his word for it.)

Of course, Andresen’s support can create skepticism as much as settle it. Andresen is a core dev on the Bitcoin system, and therefore immensely powerful within the Bitcoin community. As much as Bitcoin users want to believe in the libertarian, decentralized currency, it’s still, at the end of the day, a computer program. Only a handful of people have the “commit privileges” necessary to alter the system’s code, meaning that Bitcoin’s future is still in the hands of a small circle of developers.

To that end, for roughly a year, the Bitcoin community at large has been embroiled in a controversy over the size of “blocks,” transaction data generated by the program and verified by “miners,” who get a reward for the verification. As of now, block size is currently limited to one megabyte, per Nakamoto’s original specifications, which caps the number of transactions at around seven per second. As The New Yorker describes it, some Bitcoin developers believe “that Bitcoin transaction volumes will blow past the seven-per-second limit by 2017, at the latest, creating backlogs, settlement delays, and perhaps even mass outages.” In the absence of the creator of Bitcoin, whose opinion might be considered definitive, the community has split into two camps: those who believe the block size should remain one megabyte, and those, like Andresen, who want to increase it. Were Nakamoto to weigh in definitively on one side or the other, it could sway many people from one side to the other.

Wright has already said he’d increase the block size, and because of this, his outing could be construed as an attempt to seize power as a chief authority over Bitcoin — and swing Bitcoin toward the increase-the-size camp. Again, from The Economist:

It pays, too, to bear in mind that Mr Wright’s outing will most likely be of benefit to those in the current bitcoin civil war who want to expand the block size quickly, whose number include Mr Matonis and Mr Andresen. Mr Wright says that if he could reinvent bitcoin, he would program in a steady increase of the block size. He also intends to publish mathematical proof that there is no trade-off between the mass adoption of the cryptocurrency and its remaining decentralised. Simulations on his supercomputer show, he says, that blocks could theoretically be as large as 340 gigabytes in a specialised bitcoin network shared by banks and large companies.

Over on the Bitcoin subreddit, users are already trying to poke holes in Wright’s story, claiming discoveries of code-breaking spelling mistakes and sly-joke key signatures.

At the same time, Peter Todd, another Bitcoin developer, claims that Andresen has had his commit access revoked over fears that he has been hacked.

All of this is to say that Wright’s role in the creation of Bitcoin will always be under scrutiny — especially to the extent that he weighs in on the block-size question. Bitcoin’s most avid users, wary of centralized authority and libertarian-leaning in general, are practiced skeptics. As one popular recent Redditor wrote in a DJ Khaled-esque cadence, “Remember: they cannot break bitcoin the tech. They can only try to break bitcoin the community.”