Who Created Bitcoin? Satoshi Nakamoto Revealed
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In 2009, amid the backdrop of the Global Financial Crisis, the financial world changed with the launch of the Bitcoin network. Contextual events and the trustless payment system described in the Bitcoin Whitepaper explain why Bitcoin was created, but who created Bitcoin? To this day, the creator of Bitcoin remains unknown, using only an alias of Satoshi Nakamoto.
In 2010, we saw the last known public communication using the name Satoshi Nakamoto. The person or group who created the Bitcoin blockchain quietly stepped away from the project, leaving an estimated 1.1 million bitcoins untouched in Bitcoin wallet addresses on the blockchain. Let’s look at what we know about the creator of Bitcoin
Who is Satoshi Nakamoto?
Satoshi Nakamoto is the pseudonym used by the person or group who created Bitcoin. The quest to find Satoshi led to a California man named Dorian Nakamoto. However, Dorian Nakamoto has denied being Bitcoin’s inventor, stating at the time that he had never heard of Bitcoin. The identity of Satoshi Nakamoto remains unknown.
The real Satoshi, whoever he, she, or they might be, began working on Bitcoin in 2007. By 2008, Satoshi published the Bitcoin Whitepaper, a document that describes what Bitcoin accomplishes in building a peer-to-peer electronic cash system. The whitepaper also details how the Bitcoin operates by replacing trusted intermediaries with proof-of-work that aligns rewards with good behavior and disincentivizes bad actors.
Let’s explore Satoshi Nakamoto’s accomplishments as they relate to Bitcoin, now the world’s largest cryptocurrency by market capitalization.
What Did Satoshi Nakamoto Achieve?
In 2009, the Bitcoin network went live, posting the Genesis Block to the new blockchain. The first Bitcoin block contained a message.
“The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”
Whether the message refers to the reason for creating Bitcoin or acts as a timestamp remains unknown.
However, the fledgling blockchain required several steps to create a sound form of digital currency that can’t be double-spent. Bitcoin logs each transaction on a public blockchain, eliminating the need for an intermediary.
1) Writing The Bitcoin Whitepaper
The Bitcoin whitepaper is only nine pages long and begins by discussing how financial transactions are handled using traditional systems. In short, there is always an intermediary that can reverse a transaction for any number of reasons, including error, censorship, or double-spending. This intermediary is typically a bank or payment processor in our current financial system.
The Bitcoin whitepaper goes on to detail how the Bitcoin network would validate Bitcoin transactions and allow users to transact peer-to-peer without a middleman. The whitepaper also describes how proof-of-work, a method to prevent email spam borrowed from Adam Back’s Hashcash, would be used to secure the network. The Bitcoin whitepaper can be viewed on bitcoin.org or the Satoshi Nakamoto Institute website.
2) Solving Double Spending
As its name suggests, double spending refers to spending the same money more than once. With physical currency, the problem doesn’t exist.
If you pay $5 for an ice cream cone, the ice cream vendor now has the $5 bill, preventing you from spending it again. With electronic payments, a bank or payment processor prevents double spending by verifying balances. If you spend more than you have, your account goes negative, and you’ll owe the bank the balance plus any fees.
However, electronic cash systems can allow the same digital currency to be spent more than once. Bitcoin solves this problem by having nodes use a time stamp system to establish when a transaction occurred. Nodes on the network confirm that there is no double-spend before adding a new block of transactions to the blockchain.
3) The Creation of Blockchain
Satoshi’s creation of Bitcoin paved the way for the wide variety of blockchains we have today.
On a basic level, blocks are containers for transactions. Each of these blocks of transactions links to the previous block, forming a chain. Bitcoin Block 0 was the Genesis Block, with each subsequent block linking to the previous block in the chain using a hash value. This linking method makes it increasingly difficult to alter a transaction that is further back in the chain. These chained blocks create an immutable ledger, a record of transactions with pseudonymous wallet addresses as the only identifier.
Bitcoin Block 1 was mined on Jan 8, 2009, five days after the Genesis Block. Block 1’s header value includes the SHA-256 hash of the Genesis Block, forming the first link in the blockchain. A hash is an encrypted value that condenses large or small amounts of data to a fixed-length alphanumeric string.
The process of creating these blocks is called mining in the Bitcoin blockchain. It’s akin to a gold miner expending energy to mine gold, increasing the gold supply in so doing.
In some circumstances, such as when two blocks are mined simultaneously, a blockchain can split into two chains. By design, Bitcoin nodes choose the longest chain. As a new block is added to one side of the split chain, it becomes longer and becomes the accepted chain. Transactions from orphaned blocks in the split chain are then returned to the mempool, a holding area for pending transactions.
Without Bitcoin, it’s likely we would not have Ethereum, Solana, or any of the hundreds of other blockchain projects that owe their existence to Satoshi’s work in building the Bitcoin blockchain technology.
Is Satoshi Nakamoto a Real Person?
We still don’t know if Satoshi was a person or a group of people. However, many suspect that Satoshi was an individual and likely someone from the cryptographic community. Satoshi’s use of the pronoun “I” in the announcement of Bitcoin suggests that Satoshi was an individual rather than a group, although several people collaborated on the Bitcoin project through discussion boards and email.
Hal Finney, one of the people thought to possibly be Satoshi, responded to the message. Soon after, Hal Finney became involved in Bitcoin’s early stages, reportedly working with Ray Dillinger and Satoshi to review Bitcoin’s accounting code.
5 People Satoshi Nakamoto Could Be
Satoshi’s real identity remains a mystery. However, the cryptography skills and background required to create Bitcoin point to a narrow field of possibilities. Some have since denied being Satoshi, while others have been eliminated as likely candidates.
Regardless of who the real Satoshi Nakamoto is, we owe him, her, or them a world of gratitude for creating blockchains as we know them today. Given Bitcoin’s potential to disrupt the existing financial structures — and those who benefit from them — it’s probably best to leave Nakamoto’s true identity unknown.
Let’s look at some of the people who have been suspected to be Satoshi, some of which were later proven to be less likely to be Satoshi.
Nick Szabo
Years before Satoshi wrote the Bitcoin whitepaper, Nick Szabo wrote about a cryptocurrency called Bit Gold, a project with roots dating back to 1998. The project bore stunning similarities to Bitcoin, including cryptographic hashes and reusable proof of work, a feature added to a bit gold variant by Hal Finney (another Satoshi candidate).
In other blog posts, Nick Szabo discussed the problems with our current financial system and its reliance on trust in third parties. Satoshi expressed parallel concerns in both the Bitcoin whitepaper and other writings.
Nick Szabo is a computer scientist who first proposed smart contracts, a core feature of Ethereum, more than two decades before Ethereum launched. Bitcoin also supports smart contracts, using Script, but limits opcodes to prevent denial of service (DoS) attacks.
However, Nick Szabo has denied being Satoshi on several occasions and reportedly seemed surprised to learn that Bitcoin supported smart contracts.
Hal Finney
Hal Finney was the first person to respond to Satoshi’s announcement of the Bitcoin project on metzdowd.com. He was also the first person to receive a Bitcoin transaction and worked on early coding for Bitcoin.
Hal Finney’s cryptography and computer science background makes him a likely candidate to be Satoshi.
Curiously, Hal Finney also lived two blocks away from Dorian Nakamoto, another candidate for the Satoshi of Bitcoin fame. Many have speculated that Hal borrowed his neighbor’s name as an alias.
Finney was diagnosed with ALS in 2009 but continued programming and working on Bitcoin. In 2014, Finney passed away.
While Finney fits the bill of being Satoshi in many regards, skeptics point to time zone discrepancies between posts attributed to Satoshi and those of Finney. Hal Finney also reportedly disliked the implementation of Hashcash’s proof of work, making it unlikely that Finney would have chosen to rely on such a similar system for his own project if he were Satoshi.
Dorian Nakamoto
Another computer scientist, Dorian Nakamoto, was speculated to have been the Satoshi of Bitcoin fame. In fact, Dorian’s birth name was Satoshi Nakamoto.
Nakamoto is described as a private man with libertarian leanings. As an engineer and programmer, he also has the skills needed to create Bitcoin. However, in a response to a Newsweek article published in 2014, he categorically stated that he was not the Satoshi who created Bitcoin.
Craig Wright
Unlike most Satoshi candidates who deny being Satoshi, Craig Wright is known for his claims to, in fact, be Satoshi.
Australian-born Wright created Bitcoin Satoshi Vision (BSV) in 2018, a project meant to follow Satoshi’s original vision for Bitcoin itself. Wright was also a key figure in the Bitcoin Cash community, a fork of Bitcoin that arose from disagreements over block sizes for the Bitcoin chain. BSV was itself a fork of Bitcoin Cash and further increased block sizes.
The Australian computer scientist also filed more than 100 blockchain-related patents, giving him the background and knowledge to be Satoshi in the eyes of many within the Bitcoin community. However, doubts remained, and skeptics pointed to Wright’s inability or unwillingness to sign a transaction using the private keys that belonged to Satoshi.
In 2024, Craig Wright lost a key UK court case in which the judge ruled in favor of the Crypto Open Patent Alliance. In the judgment, the court found that Wright was not Satoshi, stating that Wright had forged documents tying Wright to the Satoshi pseudonym.
Wei Dai
In 1998, Wei Dai proposed two protocols for digital currency in an essay later referenced in the Bitcoin whitepaper. Similar to Bitcoin, Dai’s B-Money protocol would leverage Hashcash’s proof of work to create new coins. Similar to proof of stake, the proposed B-Money would also “bail” to ensure network nodes follow protocol rules. Servers found to be dishonest would lose their bail, much like slashing works in today’s proof-of-stake networks.
Perhaps in tribute to Wei Dai, the smallest unit of Ethereum is WEI, and the stablecoin for the Maker protocol is DAI.
Wei Dai was a skilled C++ developer for Windows, the operating system on which the Bitcoin software was first released. He had also already described a digital currency similar to Bitcoin 20 years before Bitcoin’s launch.
Additionally, language analysis comparing Dai’s writings to Satoshi’s writings found a strong entropy match between Dai and Satoshi. Some speculate that Dai faked the emails he received from Satoshi during Bitcoin’s early days. Those that matched closely included Gavin Andresen (former Bitcoin Core Developer), Wei Dai, and Hal Finney.
Like most others involved in Bitcoin’s early development, Dai has denied being Satoshi.
Other Satoshi Candidates
Several other people have been suggested as the Bitcoin inventor, including Elon Musk, Adam Back, and Yonatan Sompolinsky. Let’s look at some other possibilities that the cryptocurrency community has identified.
- Vili Lehdonvirta: A 2011 New Yorker article pointed to Finnish Professor Vili Lehdonvirta as possibly being Satoshi.
- Elon Musk: In a blockchain rumor nearly as old as Bitcoin itself, Musk has been named as a possible Satoshi candidate. Elon Musk denied being Satoshi and speculated that Satoshi was a pseudonym created from parts of major corporation names.
- Adam Back: The creator of Hashcash, a proof-of-work system to combat email spam, has also been mentioned as a Satoshi candidate.
- Yonatan Sompolinsky: Many suspect that the founder of Kaspa, a newer proof-of-work cryptocurrency, could be Satoshi.
- Gavin Andresen: As an original Bitcoin Core developer, Gavin Andresen’s name often comes up as a potential Satoshi candidate. Andresen’s writing also shares many similarities with Satoshi’s.
The Disappearance of Satoshi Nakamoto
Just two years after Bitcoin’s launch, Satoshi disappeared from public view. Wallets suspected to belong to Satoshi remain untouched, with an estimated 1.1 million bitcoins held in various wallet addresses. This amount becomes more significant when compared to Bitcoin’s maximum supply of 21 million. 5.238% of all bitcoins may never circulate.
Satoshi Timeline
- October 31, 2008: The Bitcoin Whitepaper is published on bitcoin.org.
- January 3, 2009: Satoshi creates Bitcoin’s Genesis block. All subsequent blocks link back to Block 0.
- January 12, 2009: Satoshi sends 50 bitcoins to Hal Finney. Satoshi and Hal Finney worked closely on Bitcoin’s early testing and debugging.
- November 19, 2010: Satoshi launches BitcoinTalk, a forum to discuss then then-fledgling cryptocurrency. Some dates suggest that BitcoinTalk.com was founded by Satoshi on November 22. However, Satoshi’s user ID was created on November 19.
- December 12, 2010: Satoshi makes his last public post, referring to the need for more work on denial of service (DoS).
- December 13, 2010: The following day marks the last day on which Satoshi was active on BitcoinTalk.com.
- April 23, 2011: Satoshi continued communicating with Bitcoin developers Mike Hearn and Gavin Andresen. Mike Hearn shared the last message from Satoshi, which indicated that Satoshi had moved on to other things and that the Bitcoin project was in good hands.
There was no communication from Satoshi Nakamoto after April 2011. Shortly thereafter, other projects launched cryptocurrencies, beginning with Litecoin in October 2011, a fork of Bitcoin’s code that aimed to provide better scalability through faster block times and a larger supply.
Anonymity May Be Best
While the world still wonders who made Bitcoin, it may be best that Satoshi remained anonymous. The amount of Bitcoin held in wallet addresses believed to belong to Satoshi could create a security risk.
However, it’s also important to consider Bitcoin’s potential role as a digital world currency that may one day replace fiat currencies. The world runs on a credit-based monetary system. Someone who disrupts that structure could be at risk from governments or businesses that benefit from the current financial system.
As importantly, Satoshi’s leaving 1.1 million bitcoins untouched aligns with the goal of creating a decentralized currency for everyone rather than a digital bauble designed to create wealth for a select few.
How Much Bitcoin Does Satoshi Nakamoto Own?
Most estimates put Satoshi Nakamoto’s Bitcoin holdings at close to 1.1 million bitcoins. In Bitcoin’s early days, bitcoins could be mined with a CPU with mining rewards of 50 bitcoins per block. Bitcoin’s first halving didn’t occur until after Satoshi left public view, meaning all the mining Satoshi did during Bitcoin’s inception added up quickly when measured by today’s Bitcoin price.
If estimates are correct, Satoshi’s bitcoins are worth more than $7.1 billion dollars. However, many see this money as untouchable — assuming Satoshi is still alive — because Satoshi’s wallets are watched closely on the blockchain. Any movements in those Bitcoin wallets can be tracked and may reveal Satoshi Nakamoto’s identity.
Conclusion
We may never know who Satoshi Nakamoto is, and that may be for the best. Satoshi Nakamoto created Bitcoin, and we owe them our gratitude for making cryptocurrency and blockchains a reality. However, with Satoshi’s disappearance, Bitcoin is now in the hands of the community, which seems to align with Satoshi’s goals for Bitcoin. Even though we may never know the real identity of Bitcoin’s creator, expect ongoing speculation and endless theories that may become less likely to be confirmed as time passes. Alas, Bitcoin’s lore and its mystery both add to its value.
FAQs
Who is the real founder of Bitcoin?
Bitcoin’s inventor used the pseudonym Satoshi Nakamoto. However, we don’t know the real identity of this person or whether Satoshi was a group of people.
Who owns the most Bitcoin?
Satoshi Nakamoto, the person or group that created Bitcoin, owns an estimated 1.1 million bitcoins.
Could Satoshi Nakamoto sell his Bitcoin?
If Satoshi hasn’t sold his bitcoins by now, many speculate that he will never sell them. From an idealistic standpoint, selling now could tarnish Bitcoin’s image as a pure cryptocurrency. Selling or moving Satoshi-era bitcoins also brings considerable security risks due to their $7 billion value in today’s market.
Will it ever be revealed who Satoshi Nakamoto is?
It’s unlikely that we will ever know the true identity of Satoshi, although some of the project’s early contributors may know Satoshi’s identity. Thus far, no one who might know has revealed who invented Bitcoin.
References
- Bitcoin Whitepaper (bitcoin.org)
- Bit Gold: Towards Trust-Independent Digital Money (archive.org)
- Smart Contracts (fon.hum.uva.nl)
- Decoding the Enigma of Satoshi Nakamoto and the Birth of Bitcoin (nytimes.com)
- The Face Behind Bitcoin (newsweek.com)
- Craig Wright Lied to UK Court ‘Extensively and Repeatedly,’ Judge Writes (yahoo.com)
- The Crypto-Currency (newyorker.com)
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