Will the Real Creator of the Bitcoin Please Stand Up?

08 May 2016 10:04:56 AM

By: DailyForex.com

The mystery behind the bitcoin may—or may not-have been solved. The often cited version of the crypto-currency’s origin points to a figure named Satoshi Nakamoto who issued 21 million ‘coins’ when he introduced the bitcoin in 2009 presumably in Japan. This theory was never confirmed and the cat may have been let out of the bag last week when Australian entrepreneur Craig Wright publicly identified himself as creator behind the Nakamoto name.

Mr. Wright at first was able to back up his claim by providing coins known to be possessed by bitcoin's creator as technical evidence to his ownership. Many bitcoin experts, however, have refused to accept Wright’s claim, pointing to a lack of bona fide mathematical proof that he is the father of the bitcoin and accusing him of offering deceptive “proof” that has been deemed a scam by experts.

Within days of his revelation, and after promising to provide irrefutable proof, with his back to the wall, Wright erased his website, along with its exposed sets of “proofs” and apologized online to the public for his inability to prove his true ownership.

Wright is an Australian computer scientist/holder of some twelve different university degrees. He was asked to show unassailable mathematical proof that he was indeed Satoshi Nakamoto, bitcoin’s anonymous creator and he did so in a series of carefully controlled interactions with journalists and bitcoin core developer Gavin Andresen.

Cryptographers tore the confession apart within minutes pointing to several red flags that disprove Wright as the bitcoin’s rightful owner. According to these currency experts, Craig Wright’s writings did not appear in any way similar to Satoshi’s original proposals and Wright’s decision to announce his ownership at this time because he ‘wanted to be left alone’ did not ring true.

Why did Wright do this?

All this leads to the question of why someone like Wright would go to such great lengths to turn the bitcoin on its head at this time. Theories abound, of course, with sleuths looking for a convincing argument and some coming up only with Wright’s need to convince the Australian Taxation Office that he is the creator of bitcoin in order to get out of an enormous debt obligation he owes the authority.

Uncovered documents point to a certain set of shell companies controlled by Wright around the world which are currently involved in a multimillion dollar liability for the claimed research and development credits related to Wright’s various computing and security businesses for which he is being investigated. Proving that he is possession of $400 million worth of the original Satoshi bitcoins could get him off this hook.

So what is the real story behind Wright’s confession and if Wright is not the real Satoshi Nakamoto, who is? New conspiracy theories have cropped up including the possibility that the confession was part of a plot to divert attention from the fact that the future of the bitcoin is currently under question. Or it could be an elaborate ploy to flush out the real Satoshi by using Craig Wright as a front man.

The question of the bitcoin’s origin may never be solved but it continues to be the most popular crypto-currency, preferred by millions over all other virtual currencies available around the world.

The fact is, however, that the bitcoin was not the first such currency to be introduced to Forex markets. Liberty Reserve, an online digital money business run out of Costa Rica by one Arthur Budovsky, introduced its version of virtual money in 2007. Anyone could use Liberty Reserve's website to transfer money and there was very little oversight at the time. To register for an account, the site required only someone's name, e-mail address, and birthday, an open invitation for criminal activity.

According to a federal indictment, Liberty Reserve had more than 1 million customers worldwide, including 200,000 in the United States and handled 12 million financial transactions a year. After 9/11 when law enforcement was beefed up considerably, the U.S. government used the Patriot Act to go after the payment processor, labelling it a money laundering organization and cutting it off from the American financial system.

American investigators took over the website and shut it down in 2013, and arrested Budovsky and several coworkers on charges of money laundering and operating an unlicensed money transmitting business. Budovsky pleaded guilty to the charges and admitted to secretly moving at least $122 million. Last Friday, U.S. District Judge Denise L. Cote sentenced him to twenty years in federal prison.

Could the bitcoin and its unidentified owner end up with the same destiny as Liberty Reserve? How long will it be before investigators uncover the real team behind the crypto-currency and reveal the unsavory activities in which it is involved? The mystery continues.

Cina Coren is a former Wall Street broker and financial advisor. She holds a Master's degree in Communications and spent many years writing for international news outlets and journalistic publications. Today, Cina spends most of her time writing internet articles and blogs, and reading various newspapers to stay on top of the news.

DailyForex Newsletter
0 User Reviews

Registration is required to ensure the security of our users. Login via Facebook to share your comment with your friends, or register for DailyForex to post comments quickly and safely whenever you have something to say.

Log in | Create a DailyForex.com Account Now