Satoshi Nakamoto is Adam Back. Maybe.
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New York Times reporter John Carreyou claims Satoshi Nakamoto is the pseudonym of 55-year old developer Adam Back, and that Back created bitcoin. Carreyou sifted through the various possible suspects, narrowed it to Back and a few others, did what sounds like a fairly sophisticated AI-based writing analysis, and concluded that Back is the only person who could have possibly written all the public documents attributed to Nakamoto. Ipso facto, Back is Nakamoto, he claims.
I care about this, but not for the reasons most other people care. Before I came to American Banker, I spent about a decade covering bitcoin and cryptocurrencies at The Wall Street Journal, and spent a lot of time on the topic of Nakamoto’s identity. Now, as somebody who never did crack the case, I have to admit I’d be jealous if somebody else really did unmask bitcoin’s creator. And I know Carreyou from when we both worked at the Journal; he is one of the two or three best reporters I’ve ever known.
Did Adam Back create bitcoin under the pseudonym Satoshi Nakamoto? Maybe! Back’s name has been on the short list of purported Nakamotos for years. I myself have asked him that very question in interviews. Back has the knowledge and experience that it’s a believable claim. He was early to the project. And as Carreyou shows, his writing tics overlap significantly with Nakamoto’s. And yet, what John presented is just not definitive.
First off, Back himself is still publicly stating he is not Nakamoto. Second off, there is really only one piece of beyond-a-reasonable-doubt evidence, and the Times story doesn’t have it: showing publicly that you control the private keys to the roughly 1 million bitcoins that the real Nakamoto mined in bitcoin’s early days. Most people I know in the bitcoin world would never accept a Nakamoto claim without proof of possessing those keys. And even then the possessor would have to prove he hadn’t just stolen them. For instance, if I somehow had those keys, and used them to try and prove I was Nakamoto, I’d be unmasked as soon as people started asking detailed, pointed questions about bitcoin’s code. The keys are the proverbial smoking gun, but even the keys on their own are not enough.
Wouldn’t Back admit to being Nakamoto at this point, if he really was? Maybe not. I’d imagine most if not all of the legal risk of creating bitcoin is gone at this point, but the notoriety might not be worth the headache. Yes, you’d be claiming a fortune that makes its holder one of the 30 or so richest people on the planet, at current prices, on paper so to speak. But claiming that fortune also makes you a target.
But this focus on Nakamoto and that fortune, and the obsession with bitcoin’s price and getting rich off it, illustrates something I’ve been thinking about lately: nobody really understands bitcoin’s importance. What I mean by that is, the real lesson of bitcoin isn’t that you can create an independent currency that can become worth a trillion and get rich off it. The lesson of bitcoin is what it says about this thing we call “money.”
Throughout history, money has been a complicated network of government-issued currency, maintained and managed and distributed by banks, and exchanged among the population, who use it for its ultimate goal: to buy the resources they need to live, and even enjoy that life. But bitcoin showed you could winnow that entire complicated network down to a single computer program. “Money” is actually nothing more than a record-keeping system for the distribution of resources that can be completely automated. And that program incidentally was released as open-source software, available for anybody to copy and use. The cost of creating a new monetary system today is exactly zero, which is why there are a couple million bitcoin copycats out there.
Anyhow, that’s how I see the real revolution of bitcoin. So the identity of Nakamoto is interesting, and the price of bitcoin is good water-cooler fodder, but those things aren’t what makes bitcoin important. Bitcoin redefined money in ways that we still don’t appreciate, and I do expect this is going to have an impact on the banking industry (whether or not bitcoin itself is even part of that impact). The technology behind bitcoin is just the rails, the wiring. All this blockchain stuff seems radical now, but in ten years it won’t seem so fascinating. It’ll just be the back-office stuff. What will be fascinating is what the citizenry can do with a completely automated, zero-cost monetary system. I think we are just starting to explore that.