The Memo: Unravelling Bitcoin’s identity

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Unravelling Bitcoin’s identity: The Strange Case of Dr. Wright and Mr. Nakamoto

Alice Gregory – 19 February 2024

Cryptocurrency has had its fair share of the spotlight in recent legal news, especially since the collapse of FTX, but its most recent appearance concerns the identity of Bitcoin’s founder. It’s a story with a plot worthy of a TV drama, but the workings of a highly technical IP dispute. The tale goes back to Halloween of 2008, when Satoshi Nakamoto published the white paper, Bitcoin: A Peer-to-Peer Electronic Cash System. This marked the introduction of the digital currency, but while the paper clearly explained the concept, the identity of its writer remains a mystery. Australian computer scientist Craig Wright, however, would argue otherwise, having claimed to be Nakamoto since 2016. This confession has been met with scrutiny ever since and has finally been taken to the High Court to uncover the truth.

This isn’t Wright’s first run-in with the courts, as he’s been on both sides of a number of disputes since announcing his ‘true’ identity. For instance, he lost a libel case in a Norwegian court in 2022, before being awarded just £1 in a separate defamation trial in London later that year. The high court judge who ruled on the latter, however, added that Wright had deliberately falsified evidence to back up his claim.

The fallout surrounding his latest appearance revolves around Bitcoin’s IP rights. In fact, when Wright first claimed to be Nakamoto, he immediately launched a copyright violation lawsuit against a number of crypto developers and companies. The non-profit community, Crypto Open Patent Alliance (COPA), has shared its concerns over such legal action, and Wright’s intention to thwart efforts to develop projects related to Bitcoin.

In short, the trial will eventually come down to the question of whether Wright is who he says he is. In its own IP twist on the classic talk show paternity test segment, COPA hopes that the court will rule that Wright is not the father of Bitcoin. Expert reports and technical know-how will be central to the case, which has just finished its first cross-examination. COPA’s lawyers have so far proved that Wright’s copy of the white paper was not an original, as its font was produced more recently than the text. Wright was also unable to answer (reportedly simple) coding questions in court, which related to concepts that were used over 500 times in Bitcoin’s original source code. It doesn’t help that, to this day, he has been unable to prove that he has access to Nakamoto’s bitcoins. He’s claimed that he destroyed the private keys for this years ago, but his lawyers have also asserted that Wright simply doesn’t want to share this information due to his ‘philosophical’ belief in privacy.

It’s taken eight years for a definitive judgement on Wright’s controversial claims, and the trial is set to wrap up in March. It looks like this could certainly become a landmark case in the crypto space, potentially affecting future decision-making and IP disputes related to digital currency down the line.

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