Bitcoin’s Origin

I started researching the history of this digital asset and cryptocurrency last year, and I was fascinated. Reading about it was like entering a rabbit hole. Learning the history of Bitcoin and its influences, such as the Cypherpunk movement, while seeing where the world is heading got me into stacking Sats.

You can read the famous ”A Cypherpunk’s Manifesto” here.

I think it is crucial for those who buy Bitcoin to know its history and why Satoshi Nakamoto created it in the first place.

Genesis

Before the Bitcoin network came about and before the first bitcoin was mined, Bitcoin.org was registered on August 18th, 2008. A couple of months later, on October 31st, 2008, a link to the paper titled Bitcoin: A Peer-to-Peer Electronic Cash System, authored by someone called Satoshi Nakamoto, was posted to a cryptography mailing list. This paper contains technical details of how the Bitcoin network would work and how it would allow people to send and receive e-money, Bitcoin, to one another without the usual middlemen such as the banking and financial institutions.

On January 3rd, 2009, the Bitcoin network was born with Satoshi Nakamoto mining the first block of Bitcoin (block number 0.) This first block of Bitcoin ever mined is called the “Genesis Block.” Mining this block rewarded Satoshi Nakamoto 50 bitcoins.

An essential part of the history of Bitcoin is the fact that Satoshi Nakamoto embedded the following text in the coinbase of the first block of Bitcoin:

“The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”

This text references an article published by The [London] Times magazine on January 3rd, 2009. Many Bitcoin fans and analysts believe that Satoshi instilled this headline in the raw data of the Genesis Block to hint why Bitcoin was created in the first place and how it was created to free us from our dependency on banking and financial institutions that have become too big to fail and too big to not bail.

According to Satoshi Nakamoto, the work on the writing of the code for Bitcoin started in 2007.

Hal Finney: The First Receiver of Bitcoin. And Was He The Real Satoshi Nakamoto?

The receiver of the first Bitcoin transaction was Hal Finney, an early member of the cypherpunk movement, a computer scientist, and a software developer who worked at PGP Corporation. Finney was the second developer hired there and was also the creator of the first Reusable Proof-of-Work (RPoW) as e-money, which Bitcoin is based on. According to Finney, Satoshi sent him the first bitcoin ever sent as a test. He, other than Satoshi Nakamoto, was the first to use the Bitcoin software.

Finney had been rumored to be the creator of Bitcoin, because:

  1. He was the creator of creator of the first Reusable Proof-of-Work (RPoW) as e-money
  2. He, other than Satoshi Nakamoto, was the first to use the Bitcoin software
  3. He was the receiver of the first Bitcoin transaction
  4. He happened to live a few blocks away from a systems engineer whose birth name is Satoshi Nakamoto.

The computer can be used as a tool to liberate and protect people, rather than to control them.

Hal Finney

Finney, however, has flatly denied that he is the creator of Bitcoin.

The First Commercial Bitcoin Transaction

The first documented commercial transaction using bitcoin or cryptocurrency occurred on May 22nd, 2010, when Laszlo Hanyecz bought two Papa John’s pizzas with 10,000 Bitcoins. May 22nd has since then become known in the Bitcoin world as Bitcoin Pizza Day.

Who is the Real Satoshi Nakamoto?

Satoshi Nakamoto is the creator of Bitcoin. He was apparently born on April 5, 1975. No one, however, has ever figured out who he is. No one has ever claimed to have met him. No one knows if Satoshi is a person or a group of people. For all we know, Satoshi could be a woman. Satoshi Nakamoto is a pseudonym used by Bitcoin’s creator(s.)

Many people have claimed to be Satoshi Nakamoto, including Craig Wright, an Australian academic, who recently threatened to sue anyone who uploads the Bitcoin whitepaper. Several people have also been falsely identified as Satoshi Nakamoto but denied being the person behind the enigmatic creator of the most valued cryptocurrency and cryptoasset.

In 2014, Newsweek published an article claiming that the real Satoshi Nakomoto, inventor of Bitcoin, is Hal Finney’s neighbour, Dorian Satoshi Nakamoto, whose birth name is Satoshi Nakamoto.

Mr. Nakamoto trained as a physicist at California State Polytechnic University. He also worked as a systems engineer on classified defense projects for tech and financial information services companies. He denied and continues to deny that he had anything to do with Bitcoin. He even worked with lawyers to deny it. According to him, Newsweek’s article have harmed his prospects for gainful employment.

Interestingly though, Mr. Nakamoto is a Libertarian and Bitcoin is founded on Libertarian philosophies and the Cypherpunk Manifesto.

It is possible that Hal Finney is the creator or one of the creators of Bitcoin because it cannot be a coincidence that the first user of the Bitcoin software, the first receiver of this cryptocurrency, and the cypherpunk and creator of the first Reusable Proof-of-Work as e-money happened to live just a few blocks away from a tech-savvy also named Satoshi Nakamoto.

It could be that Finney was so fond of Dorian Satoshi Nakamoto that he decided to use Mr. Nakamoto’s birth name as a pseudonym. It is also possible that Mr. Nakamoto, a Libertarian who worked at tech and financial information services companies, is the one who gave Finney the idea to create a decentralized peer-to-peer electronic cash system where financial institutions are not needed.

It could also be that Mr. Nakamoto is in fact, the real Satoshi Nakamoto and does not want to deal with the possible consequences of inventing a decentralized peer-to-peer e-money. Hence, why he aggressively denied that he is the inventor of a system and a cryptocurrency turned cryptoasset, that is revolutionizing the world. We will, perhaps, never really know. And I personally think that we should leave Mr. Nakamoto alone.

Hal Finney passed away on August 28th, 2014 due to ALS. In one of his last posts on a Bitcoin forum, Finney claimed that he still doesn’t know Satoshi’s true identity. Mr. Nakamoto has also aggressively denied that he has anything to do with Bitcoin.

On March 17th, 2014, Mr. Nakamoto made a public statement saying, “I have no knowledge of nor have I ever worked on cryptography, peer-to-peer systems, or alternative currencies.” To show how oblivious he was about the cryptocurrency, Mr. Nakamoto said, “I called the technology ‘bitcom.’ I was still unfamiliar with the term.”

The inventor of Bitcoin was active online until April 2011 and sent a final email to the cryptography list saying, “I’ve moved on to other things. It’s in good hands with Gavin (Gavin Andresen) and everyone.”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: