In late 2008, someone going by the name Satoshi Nakamoto wrote, “I've been working on a new electronic cash system that's fully peer-to-peer, with no trusted third party” in the Cryptography Mailing List. The post was titled “Bitcoin P2P e-cash paper,” and it announced the release of the white paper describing the technical underpinnings for how Bitcoin works. Nakamoto went on to release the first version of Bitcoin in 2009, and then worked with other developers to improve Bitcoin.
Except, it’s not necessarily right to say Nakamoto is someone. We don’t know if Nakamoto is a woman, man, or group of people sharing a name. And while Nakamoto created Bitcoin, which went on to become the most well-known cryptocurrency, just who or what Nakamoto is remains a mystery.
Who is Satoshi Nakamoto?
Satoshi Nakamoto, the Bitcoin founder, is the pseudonym for the person or group who created Bitcoin. While Nakamoto’s identity is unknown, that’s actually quite fitting because Bitcoin is a pseudonymous rather than anonymous cryptocurrency.
Every Bitcoin transaction is listed in its public blockchain—an online digital ledger—and can be traced to a crypto wallet. As a result, everyone can look up how much Bitcoin is in each crypto wallet, and the wallet’s address is a pseudonym for its owner. But the wallet’s owner can’t be identified unless someone can uncover the owner’s true identity.
People can sometimes figure out who owns a Bitcoin wallet by tracing transactions until the owner sells the Bitcoin for dollars using a service where they registered their identity. This is how law enforcement can catch fraudsters who steal Bitcoin or use it to launder money.
But, in spite of great efforts, no one has been able to publically confirm Satoshi Nakamoto’s identity. Even the name itself is the subject of speculation and debate. Some people believe it isn’t a pseudonym at all, and have tracked down Satoshi Nakamotos who could potentially create a cryptocurrency. Others theorize it could be a combination of the names of the large Japanese corporations Samsung, Toshiba, Nakamichi, and Motorola.
What is Satoshi Nakamoto known for?
While Nakamoto is credited with inventing Bitcoin, they didn’t work alone or invent everything from scratch. Nakamoto built on earlier concepts for digital currencies that never got a strong foothold, such as Wei Dai’s B-Money and Nick Szabo’s Bit Gold. Both were members of the cypherpunk community, who wanted to create and use public cryptography tools to avoid government observation or censorship. Cryptography-based digital currencies are a means to avoid government-created and run financial systems.
Bitcoin also incorporated other ideas from cypherpunks. For example, Bitcoin’s proof-of-work algorithm—the way people create new coins while running and securing the network—is based on Adam Back’s Hashcash protocol. First proposed in 1997, Hashcash was designed to stop email spam by requiring computers to solve a math problem before sending an email.
The Bitcoin blockchain is based on Stuart Haber and Scott Stornetta’s “chain of blocks” ledger, which they created in 1991. The idea is that data is grouped into a block and then chained together in a way that once a new block is added to the chain the previous blocks can’t be altered.
Nakamoto combined and built on these to create the first decentralized cryptocurrency, Bitcoin, and then worked with others to further upgrade the program and systems. Some highlights of these early days include:
- The Bitcoin white paper—October 2008. Nakamoto publishes the white paper, “Bitcoin: A Peer-to-Peer Electronic Cash System,” which outlines how Bitcoin works. It’s available on Bitcoin.org and has been translated into over 40 languages.
- Releasing Bitcoin—January 2009. Nakamoto announces Bitcoin v0.1 release to the Cryptography Mailing List. It was initially available only for Windows and it was very easy to mine new Bitcoins. A standard computer could mine new coins in a few hours, while it takes specially created computers much longer to earn a fraction of a coin today.
- The first decentralized blockchain—2009. With the launch of Bitcoin, Nakamoto created the first decentralized blockchain, a database that computers around the world run. Bitcoin’s use of a blockchain can help prevent double spending (when someone tries to spend the same Bitcoin twice), and it allows users to trust that transactions are valid and safe without having to rely on a central authority, such as a bank.
- Collaboration—2009 and 2010. After its initial launch, Nakamoto collaborated with others to further develop Bitcoin. But Nakamoto was careful to avoid sharing any personal information.
- Handing over the reins—late 2010. With his permission, Nakamoto lists Gavin Andresen’s (a developer who worked on Bitcoin after its launch) email address as the contact info on the Bitcoin.org homepage. Nakamoto then removes Andresen’s email from the site. Andresen also takes over the role of as the main Bitcoin developer.
- Nakamoto disappears—April 2011. In one of the last known email exchanges with an early Bitcoin developer, Mike Hearn, Nakamoto writes, “I've moved on to other things. It's in good hands with Gavin and everyone.”
Satoshi Nakamoto isn’t believed to still be actively involved in Bitcoin, but their legacy lives on. The smallest denomination of Bitcoin is called a Satoshi or Sat, and it’s 0.00000001 Bitcoin (worth $0.0002 when one Bitcoin equals $20,000).
People thought to be Satoshi Nakamoto
Given the mystery around Nakamoto’s identity, people have speculated about who is behind the name. Some claims are more outlandish (e.g., it’s a CIA conspiracy), while others are based on in-depth research, such as the time of day that Nakamoto sent emails or analysis of their writing style.
A few of the people who have been named include:
- Adam Back. Back created Hashcash, the proof-of-work algorithm that certainly contributed to Bitcoin, but he says the contribution is indirect and that he isn’t Nakamoto.
- Wei Dai. Some speculate the creator of B-money could be Nakamoto. Early emails from Nakamoto asking about Dai’s work could disprove this idea (as do Dai’s denial), unless those are all a complicated ruse.
- Hal Finney. Finney was one of the first people to get involved in Bitcoin—he was on the receiving end of the first Bitcoin test transaction from Nakamoto. Journalist Andy Greenberg dug into the idea in a story for Forbes but concluded that while Finney heavily contributed to Bitcoin he wasn’t Nakamoto.
- Dorian Nakamoto. A Newsweek cover story from 2014 pointed a finger at Dorian Prentice Satoshi Nakamoto (born Satoshi Nakamoto) as “The Face Behind Bitcoin.” Dorian Nakamoto, a physicist, worked on classified projects for large corporations and the U.S. military. But he denies being involved in Bitcoin at all.
- Nick Szabo. The creator of Bit Gold seems like a natural fit, as Bit Gold could be seen as a precursor to Bitcoin. However, Szabo has repeatedly denied being Satoshi Nakamoto.
- Craig Wright. Wright is one of the few people who claims to be Nakamoto. Some people believe his claims, while others have found counterevidence. When Andy Greenberg and Gwern Branwen investigated the idea for Wired, they initially thought the claim was true, but later concluded it might be a hoax.
Being identified as Nakamoto could have advantages, such as fame and press coverage, but it’s also a potentially dangerous position to be in. By some estimates, Nakamoto mined about 1 million Bitcoin during the cryptocurrency’s first year alone, which would be worth over $20 billion as of mid-2022. Hackers and fraudsters may prey on people who have large Bitcoin balances, and admitting you’re Nakamoto could put a big target on your back.
The bottom line
Today it’s easy to buy and sell Bitcoin, and the cryptocurrency is undoubtedly the most popular crypto based on its market cap. It spawned a whole new crypto ecosystem, filled with other types of cryptos and decentralized apps. But we still don’t know who created the crypto that started it all.