The history of Bitcoin – who is Satoshi Nakamoto?

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Satoshi Nakamoto was not the origin of Bitcoin. Learn more about Bitcoins history and where it came from

Bitcoin is a product of decades of evolution with a crazy history and everyone is asking “who is Satoshi Nakamoto?”. It all started in the deep ocean called the internet. In the beginning, there were cypherpunks, crypto-anarchistic libertarians and anarcho-capitalists. The creatures which evolved in the water of this movement, were some creepy deepsea fishes, some wired looking chimeras:

One of the earlier papers showing in which direction evolution should move was: “Transaction Systems to Make Big Brother Obsolete” (David Chaum 1985)

The Pre-historic evolution of Bitcoin🦖 

RPOW from Hal Finney came quite close to Bitcoin, it was based on Nick Szabo’s Theory of Collectables 2002. But they all were not able to find the last piece of the puzzle:

The real reason why Bitcoin took not off earlier

The Byzantine Generals´ Problem. This is a fundamental and non-naive problem. A problem which is not easily solvable by thinking a bit harder. A problem which is not solvable simply by pumping money into the research.

The Byzantine Generals Problem was not originally solved by Nakamoto, it was solved way earlier. However Nakamoto solved it in an open setup. The first land-living creature, independent of the waters of centralization. Now diversity of life on earth started to explode.

originals by: “Dinosaur” 1: By Nobu Tamura — CC BY 2.5, Wikipedia, “Dinosaur” 2: By Nobu Tamura — CC BY 2.5, Wikipedia, “Dinosaur” 3: By Dmitry Bogdanov — CC BY-SA 3.0, Wikipedia

But let´s move back to the first steps of Bitcoin:

Hal Finney – first Bitcoin Pioneer

The first transaction went to Hal Finney on January 12th 2009. Finney was one of the persons, which had a big interest to work closely together with Nakamoto. This was a time when Szabo still believed in his BitGold project.

Journalists found out, that close to Finney there lived an old man, who was forced to sell his family-house as a result of the financial banking crisis in 2008. The Name of this man was Dorian Satoshi Nakamoto. This man was later accused to be the Nakamoto of Bitcoin, but he denied this, it looked like he didn´t even knew what Bitcoin was.

Could it be possible that the name Nakamoto was just symbolic for all the innocent people who suffered from the failure of the centralized banking system? Who lost their jobs, their homes and some even their lives?

Nakamoto has left the chat

As we know, in 2011 it got quiet around Nakamoto. His last post was in 2014 on the P2P Foundation Forum, where he stressed that he is not Dorian Nakamoto. Maybe to prevent this old man from the journalists. It got also quiet around Hal Finney. On March 19th, 2013 Finney announced that he was glad that he met Nakamoto, and sadly, that he has ALS which was diagnosed in 2009, that he is fed by a tube, can´t move but is still coding with the help of speech computer. Finney as one of Bitcoins pioneers died on August 28th, 2014 in Arizona.

There were no activities around Nakamoto, until recently. In November 29th, 2018 there was activity on his account on the P2P Foundation Forum. He added a user to his friend-list and commented “nour”

Nour is the Arabic word for light. In another context, a “nour” is a caring and good person. In the Islamic context, the word NĹŤr has besides its main meaning “Light of God” also the meaning of Justice or Faith. Some people speculate that it could refer to Lightning Network.

I don´t know if it is worth the investigation… the account was hacked years ago. I have a bad feeling of what happened to this account but this is another story.

Bitcoins forgotten Convention

As you may know, there is not only one “Bitcoin”. Per convention, there is Bitcoin (uppercase B) as:

  • the network,
  • the super-computer,
  • a protocol,

well one could add:

ecosystem, market, a decentralized autonomous company/organization/community, a brand,…

and there is bitcoin (lower case b) as a protocol-token representing the coin “bitcoin” and there is the unit of account for the financial asset called BTC. Bitcoin vs. bitcoin vs. BTC. But people don´t care for conventions anyway.

  • official convention: Blockchain.com, Bitcoin.org *bitcoin.com is not the official website, but the for-profit-organisation of Roger Ver (Bitcoin Cash))

“Bitcoin with a capital B is a decentralized network that relies on a peer-to-peer system, rather than banks or
credit card companies, to verify transactions using the digital currency known as bitcoin with a lowercase b.”

(Hale et al. 2018),(Chuen und Deng 2017)

Blockchain or DLT? Token or Coin?

It is funny to see how the lawmakers are struggling with the terminologies like “blockchain” vs. “DLT” or “coin” vs. “token” (e.g. “The Path of the Blockchain Lexicon (and the Law)” Walch 2017)

Have you noticed that in the original Bitcoin-whitepaper by Nakamoto 2008 there is no use of the term “blockchain”?

no “Blockchain” in the Whitepaper

The source of the term is not exactly known. Probably it comes from one of the early marketing agencies in the ecosystem, like blockchain.com 😏. But there is a hint in Nakamotos Emails:

“Right. I’m trying to think of more clear wording for that, maybe “network blocks” or “block chain” [Mike Hearn citing Nakamoto 2009]

However, there is a US-patent from 1979 for a cryptographic method called â€œBlockchaining” only a funny coincidence? huh?

Blockchaining as a cryptographic mechanism gained some attention of the digital payment industry and also by the US-Government. It was cited in several patent-papers:

US4259720A *1978–01–09. published: 1981–03–31 by Interbank Card Association Security system for electronic funds transfer system

US4408203A *1978–01–09. published: 1983–10–04 by Mastercard International, Inc. Security system for electronic funds transfer system

US4661980A *1982–06–25. published: 1987–04–28 The United States Of America As Represented By The Secretary Of The Navy. Intercept resistant data transmission system

US5933498A *1996–01–11. published:1999–08–03 Mrj, Inc. System for controlling access and distribution of digital property

US6952477B1 *2000–07–03. published: 2005–10–04 International Business Machines Corporation. Fault intolerant cipher chaining

Conclusion

Some traces are hot, some are misleading. I think in the end Nakamoto’s identity should stay a mystery, but Bitcoin and the mechanism behind it should not! Bitcoin might be the first-mover, but being primitive is not necessarily a bad thing. Many first-movers in the evolution of life are still around despite the fact that they are forked a thousand times 😉

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