Wednesday, October 9, 2024

Has Bitcoin’s Elusive Creator Finally Been Unmasked?

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In a subsequent series of text exchanges, Hoback told me, “Peter was the only person who tried to dissuade me from doing this. He said, ‘Satoshi doesn’t want to be found—leave him alone.’ ” Once or twice, Todd’s own name had been dropped as a potential Satoshi, but the idea had been peremptorily shot down. For one thing, Todd hadn’t been more than a kid when Bitcoin was released—he hadn’t even finished college. For another, he’d frequently criticized Satoshi’s code and design decisions in an almost sacrilegious way—as one Redditor put it, in 2014, “Everybody knows that you are not Satoshi since your ‘vision’ of Bitcoin is basically the complete opposite of Satoshi.” He was a contrarian among contrarians. Hoback said, “Peter does such a good job muddying the waters, nobody ever really looked at him. But he’s very smart, and his game theory is very strong.”

Hoback returned to the Pacific Northwest to regroup. He figured he needed to rule out Peter Todd, but there wasn’t a lot of available information to work with—it seemed as though the Internet had been scrubbed of almost everything about him prior to 2013. There were, however, a few clues, and after about a week Hoback got to “that moment where you have a pit in your stomach.” Todd claimed that he hadn’t got seriously involved with Bitcoin until 2014, when he pitched in to code a new feature called “replace-by-fee,” which would allow certain transactions to jump the processing queue. Hoback discovered that Todd had actually registered for the bitcointalk.org forum in December, 2010. His first post was a throwaway request for an invitation to something. His second was extremely technical, and in a peculiar way. About an hour earlier, Satoshi had posted a schematic recommendation for future Bitcoin development—a feature called “replace-by-fee.” Todd’s contribution looked like a surprisingly sophisticated reply to the master’s original post. Upon closer inspection, it seemed less like a reply than like a correction. Hoback eventually came to believe that it wasn’t even a correction but an explicit continuation of Satoshi’s last thought. In the film, Hoback says, “Someone who had just created this account, and never posted about Bitcoin before, was finishing Satoshi’s sentences?” And that same person would later go on to develop the very same feature Satoshi was asking about? What if Todd, who had otherwise been so careful, had logged in under the wrong username this one time? (In an e-mail, Todd told me, “That post is simply me noticing a small mistake in one of Satoshi’s posts, and correcting it.” He continued, in a reference to Hoback’s earlier work, “Pointing to a one-off event like that as evidence of someone being Satoshi is QAnon-level conspiracy thinking.”)

The incident, Hoback realized, only got weirder. Three days after the replace-by-fee exchange between Satoshi and Todd, Satoshi disappeared from the forum—forever. So did Todd, who wouldn’t post again on the forum for another two years. Two years after that, in 2014, Todd would reply to a forum novice, John Dillon, who posted a bounty of five hundred dollars—a bizarrely puny amount—to create “replace-by-fee.” An allegedly leaked e-mail exchange between Todd and Dillon revealed that Dillon claimed to be some sort of intelligence agent. Hoback, for various reasons that he details in the film, came to suspect that Todd had invented Dillon as part of an ongoing misdirection campaign. (Todd told me that those claims were “an attempt to smear me,” and that the e-mails “have no relevance to Satoshi’s identity at all.”) Todd seemed perfectly comfortable with the creation of alternate personae for ventriloquist purposes. He also seemed capable of playing a long game. Hoback told me, “For some people, like Adam, trying not to look like Satoshi made you look more like Satoshi. But not for Peter Todd.” In a 2014 tweet, Todd wrote, “Pro-tip: when starting a revolutionary cryptocurrency, find someone to frame for doing it first.”

Todd, it turned out, checked all of the Satoshi boxes. Satoshi’s posting habits indicated a North American on an academic calendar, and Anglicisms in his spelling and vocabulary hinted at a Commonwealth background; Todd, at the time, was a Canadian college student. Satoshi had expertise in cryptography and economics; Todd had e-mailed Adam Back about hashcash when he was in high school, and his father was an economist. Satoshi was, by consensus, not a professional programmer, and it seemed highly unlikely that he was an original cypherpunk; he hadn’t, for example, even heard of Wei Dai’s “B-money,” another major Bitcoin antecedent, until Back filled him in. The Bitcoin white paper, contrary to academic practice, was extremely thin on citations. All of this pointed to a much younger person—something that many of Wallace’s sources observe as well. After all, it’s not unusual for coders to have their big breakthroughs at a very young age: Vitalik Buterin invented Ethereum, Bitcoin’s chief rival, at nineteen. Bitcoin, however, was coded in C++, expertise that, on camera, Todd denied having. Hoback excavated an archival version of Todd’s adolescent home page, where he found a résumé boasting that he’d coded an entire system in C++ from scratch. Why would someone bother to lie about that? (Todd told me, “It should be no surprise to someone that in the context of a highschooler’s website, I might say I know C++. But in the context of professional work on a codebase responsible for the security of hundreds of billions of dollars, I might say I’m not a good C++ programmer.”)

In Bainbridge, Hoback stopped at a fancy Italian grocery to pick up a bottle of wine. He told me, “If Satoshi had mike-dropped and never gotten involved with Bitcoin again, he would’ve been fine. But if you’d invented Bitcoin, would you have walked away, or would you have injected yourself into the narrative?” Satoshi’s anonymity might have been motivated by the fear of government or corporate reprisal—a leaderless system, with no single throat to cut, was more robust—but it could also insure that the ideas of a random twenty-two-year-old were taken seriously by his more established peers. Hoback continued, “Imagine the psychology of then having to debate people who are deploying your much younger self against you—to have your own words as a twenty-two-year-old treated with Biblical reverence and thrown back in your face.” Todd might have wanted to “torpedo the anonymous character and get involved using his real name.” Todd’s participation became all the more salient during the “Blocksize War” of 2015, which saw an originalist interpretation of Bitcoin prevail over its living-constitutionalist adversaries and set the stage for its current ascendancy.

In June of last year, Hoback flew to Prague for a conference that featured both Todd and Back. Todd wasn’t that easy to find otherwise; Hoback believes that he has neither a fixed address nor identifiable property assets. Hoback said, “His whole life style is like someone on the run,” and that he “seems to go out of his way to LARP as being poor.” (Todd told me, “I don’t make a point of ‘seeming like’ I’m poor. While I wouldn’t say I’m ‘poor,’ I’m not particularly wealthy either.”) Hoback found an abandoned Soviet-era steel plant that seemed a fitting stage for their final encounter. Hoback often shoots by himself, but in this case he brought two other people along as security. The three men climb inside the cavernous ruin of the steelworks and take their positions astride exposed girders, and Hoback unspools his theory. Todd listens at an apparent loss for words, though he produces some comic perplexity.

TODD: I’ll warn you. This is gonna be very funny when you put this into the documentary and a bunch of Bitcoiners watch it.

HOBACK: I don’t think they would be very happy with this conclusion, because you’re pretty controversial within the community.

TODD: No, I suspect a lot of them will be very happy if you go this route. Because it’s going to be, like, yet another example of journalists really missing the point, in a way that’s very funny.

HOBACK: What is the point?

TODD: The point is to make Bitcoin the global currency. And people like you being distracted by nonsense can potentially do good on that.

Hoback told me, “He said this was an example of journalists’ missing the point, not journalists’ getting it wrong. To this day, Peter is the only person who won’t say the words ‘I’m not Satoshi.’ He’ll just talk around it.” (Todd told me, “Had Cullen done the simple google search ‘is peter todd satoshi,’ he would have discovered this quote of mine as the top result: ‘And yes, I’m not Satoshi . . . which is pretty suspicious really, given it’s exactly the kind of thing Satoshi would say. :)’ ”) It was also odd, Hoback continued, that “the point” was Bitcoin’s status as a global currency—something quite different from Satoshi’s original dream of anonymous Internet cash. Had Satoshi, for better or worse, grown up?

Hoback and I walked along a rocky, deserted beach lined with the whitened carcasses of driftwood logs. With the exception of an occasional solo beachcomber, we strolled alone. For the past eighteen months, he has worked with a very tight-knit crew. He told me, “We were very concerned it would get out. The HBO executives understood this was a big story, but I’m not sure they quite understood how big—it wasn’t clear whether all of them had even heard of Satoshi before.” In the meantime, as he sees it, more evidence has accumulated. Last year, a few A.I. researchers discovered that “petertodd” was a so-called glitch token in GPT-3; when included in a prompt, the A.I. seemed as though it had been engineered, apropos of nothing, to tell the user that Peter Todd was a Bitcoin developer. In March, a new trove of Satoshi e-mails was released as part of the Craig Wright trial. Hoback read them, and noticed that both Todd and Satoshi liked to use the words “sweet” and “retarded.” This may seem less forceful in the light of Benjamin Wallace’s book. Wallace points out that many Satoshi investigators have been bedevilled by faulty pattern-matching, a particular vulnerability for those who have seized upon superficial stylistic similarities with unwarranted glee. More rigorous stylometric analysis might not be “magic,” but the technique—which emphasizes correspondences between run-of-the-mill words rather than unusual ones—remains extremely useful for corroboration. When I asked Hoback, as we meandered along the windswept shoreline, why he hadn’t availed himself of stylometry, he said that he was happy to leave such details as an exercise for the public. The evidence remains circumstantial. Hoback cannot exclude the possibility that Bitcoin was collectively authored, for example, and he freely concedes that the story remains incomplete.

I reached out to Todd with the expectation that his replies would be slippery. For the most part, however, his tone was sober. He wrote, “For the record, I am not Satoshi. It’s a useless question, because Satoshi would simply deny it. Which has led to myself and others making fun of this attribution nonsense on multiple occasions.” He continued, more brightly, with a historical analogy: “Asking this question would be like someone in 1895 going around asking people ‘Did you write the Federalist papers?’ ” He went on, “Satoshi obviously didn’t want to be found, for good reasons, and no-one should help people trying to find Satoshi. Making fun of the question itself is just good manners. (For the record, I did not write the Federalist papers either!)” He had some further quibbles—his father, he pointed out, had a degree in the rather obscure discipline of forestry economics, and he considered himself Back’s mentor rather than the other way around—but his main concern was for his personal safety. He wrote, “Cullen is—without proof —also claiming that Satoshi is one of the richest people on earth. Obviously, falsely claiming that ordinary people of ordinary wealth are extraordinarily rich exposes them to threats like robbery and kidnapping from criminals trying to get that wealth. I personally am doing some unplanned travel due to the risks this false claim poses to my personal safety.”

Hoback is pretty sure he knows what the broader reception will look like: “People will poke holes in it, tear it up, tell me I got played by a troll. It will be a lot for people to swallow at face value.” If Hoback’s theory is debunked, the Bitcoin community will laugh and move on. If Hoback is correct, Todd will find himself in a very difficult bind. Satoshi’s estimated stash represents a little less than six per cent of the total circulation, more than enough for him to wield outsized control over the market. If the coins are dumped, and even if they might be dumped, it could be disastrous for Bitcoin’s price. The current stability of the system relies on the assumption that Satoshi and his coins are gone forever, frozen by the liquid nitrogen in Hal Finney’s brain. When the cryptocurrency exchange Coinbase went public, in 2021, its S.E.C. filings noted that the public identification of Satoshi was an outstanding risk. If Satoshi is uncloaked, he might have to choose between unimaginable affluence and the integrity of the system he built.

Late in the process, Hoback uncovered an old chat log that appeared to have been recorded by mistake. In it, Todd writes, “I’m probably the world leading expert on how to sacrifice your bitcoins (a rather dubious honor…) and I’ve done exactly one such sacrifice, and I did it by hand.” Hoback reads this as both a cryptic confession and an assurance: “Like, Peter wanted his inner circle to trust that he had in fact sacrificed his bitcoin.” (Todd told me this is a “completely absurd interpretation” of a technical discussion about cryptography.) If Todd were Satoshi, Hoback pointed out, he could have burned them in public, on the blockchain, without ever having to come forward. He didn’t. Hoback told me, “I suspect he still has access. To let go of that much wealth—humans just aren’t built that way. Bitcoin was built around the premise of greed.” Two days later, HBO released the “Money Electric” trailer. All of a sudden, millions of dollars of early bitcoins that may have belonged to Satoshi—much of it mined in the first few months of 2009, and untouched since—began to move.

We walked by a small, hand-lettered sign that said “Don’t Steal Wood.” The idea hadn’t occurred to me, although the logs were certainly attractive. Bitcoin has long been tarred as an artifact of the anarcho-capitalist fringe. But its underlying architecture has no natural political valence, and could equally well serve coöperative ends. An exposed Satoshi might yet embrace the opportunity to reinterpret his youthful vision. He could relinquish his own narrow self-interest and destroy his coins for the sake of others. This Satoshi would not be remembered as the person he once was but as the proper legend he became. ♦

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