Craig Wright Says He Invented Bitcoin, Now He’s Suing Those Who Doubt Him

Many reject Wright's claim to be Satoshi Nakamoto, the mysterious genius behind Bitcoin.

By Olga Kharif, Bloomberg | Updated: 22 June 2019 18:15 IST

Craig Wright Says He Invented Bitcoin, Now He’s Suing Those Who Doubt Him

The true creator of Bitcoin is estimated to hold about $9 billion of the Bitcoins

Highlights

Craig Wright is an Australian-born technologist
Wright sent a legal notice to Vitalik Buterin of Ethereum fame
He has also filed a suit against a podcaster named Peter McCormack

At a convention on digital currency, rarely does an audience Q&A session include a question as incendiary as, "Why is this fraud allowed to speak at this conference?" But that's how a discussion about Bitcoin ended up last year in Seoul.

The supposed fraud is Craig Wright, an Australian-born technologist who gained notoriety three years ago when he declared himself the inventor of Bitcoin. The provocateur is Vitalik Buterin, a baby-faced Russian-Canadian programmer who helped create another popular digital currency called Ether. No one disputes Buterin's role in Ether; many reject Wright's claim to be Satoshi Nakamoto, the mysterious genius behind Bitcoin.

Wright is a comic-book supervillain for some in the world of cryptocurrency. Buterin's rant was applauded by a handful of people at the conference, including one of the panelists and a man on the sidelines wearing a vest and metallic fiber shirt. It had the feel of an impromptu live performance of a Twitter flame war. The whole thing lasted 90 seconds. Footage recorded from the crowd provided an amusing YouTube video and sparked a fresh round of tweets mocking Wright.

That appeared to be that, until a year later when Buterin received a letter from Wright's attorney. The legal notice, dated April 12, said Wright intends to sue Buterin in the UK for defamation. Less than a week later, Wright filed suit with similar claims against a podcaster named Peter McCormack, seeking 100,000 pounds ($129,000) in damages. And on May 2, Wright's lawyers served Roger Ver, an early Bitcoin investor, at a cryptocurrency meet-up in London.

Ver says by email he intends to defend himself in court. Buterin and McCormack didn't respond to requests for comment, but all three have recently posted messages online calling Wright a fraud. In a blog post, Buterin painted the legal dispute as being about censorship, free speech and truth.

Wright has spent much of the last year with lawyers. He's currently defending against claims in a US court that he defrauded the estate of Dave Kleiman, a former business partner who died in 2013. Wright is accused of stealing Bitcoins he and Kleiman mined together about a decade ago. A federal judge ordered Wright to submit documentation of his early Bitcoin holdings, which were sealed on Monday, and he attended mediation Tuesday in Florida.

At some point, Wright determined the courts could be a useful venue for achieving his own goals. Wright, who says he holds a master's degree in law from Northumbria University in the UK, hopes a series of lawsuits can establish himself as the father of Bitcoin. "This will give me the chance to prove my credentials in front of a judge, rather than being judged by Twitter," Wright told Bloomberg in an email.

If he really is Satoshi Nakamoto, Wright will have no trouble funding a protracted legal war on his critics. The true creator of Bitcoin is estimated to hold about $9 billion of the coins. In most cases, the expensive prospect of getting sued tends to make rational people keep critical views to themselves. "There's some really broad recognition that the threat of defamation lawsuits really substantially chills speech," says David Greene, senior staff attorney at the Electronic Frontier Foundation, a civil liberties advocacy group.

For whatever reason, that didn't occur here. Online discussion of Wright reached a peak shortly after his lawsuit against McCormack, and the content was overwhelmingly scathing. During the week following his suit, 65 percent of posts expressed a negative sentiment, compared with about half before, according to Brand24, which monitors conversations on social media. Crowdfunding efforts have popped up to assemble legal defense funds for some of Wright's defendants. Data from Google suggests the litigation drew the most attention to Wright since his contentious claims in 2016, when he offered what he called definitive proof of his role in creating Bitcoin.

Although digital currencies have a market value of more than $280 billion today, the circus surrounding Wright shows that the industry still operates as a free-for-all. Experts aren't entirely sure who conceived of the world's most valuable form of digital money, but there's enough of it to go around that the threat of costly lawsuits doesn't seem to deter anyone from speaking their mind.

John McAfee is a prime example. The software pioneer turned digital coin advocate says he knows the real Satoshi Nakamoto, and it is not Wright. "I am going to tell the truth no matter what the consequences are," McAfee says. "I've been sued over 200 times in my life. I am not afraid of getting sued." In response, Wright called him "McScammer" and suggested they resolve their dispute in court.

The cryptocurrency business is full of colourful characters. Wright joined the starring cast in late 2015, when Wired magazine and Gizmodo reported that he and Kleiman may have invented Bitcoin. A few days later, Wired said Wright may instead be "a brilliant hoaxer." Police raided Wright's home in Australia as part of a tax investigation; he moved to Britain.

In May 2016, the BBC, the Economist and-most important in the eyes of Bitcoin zealots-several prominent leaders of the cryptocurrency movement said Wright furnished what appeared to be evidence of his claim to the throne. They said he gave a private demonstration of a special digital signature used by Satoshi Nakamoto. "The proof is conclusive, and I have no doubt that Craig Steven Wright is the person behind the Bitcoin technology," Jon Matonis, founding director of the Bitcoin Foundation, wrote in a blog post at the time.

This did not quiet the doubters, either. "It would be like if I was trying to prove that I was George Washington and to do that, provided a photocopy of the Constitution and said, look, I have George Washington's signature," Peter Todd, a key Bitcoin developer, told Vice's Motherboard.

Bitcoin holdings attributed to Satoshi Nakamoto haven't moved in years, according to online ledgers. Critics have urged Wright to verify his identity by transferring some coins, a proposal he has refused.

As Wright spars with some cryptocurrency faithful, he's hoping to get the community's help with identifying his next legal target. He said he intends to sue an anonymous Twitter user known as Hodlonaut, whose profile picture is represented by a cartoon cat wearing a space helmet. Wright posted a $5,000 reward for information to locate the person behind the account and referred bounty hunters to photos the user had posted showing arm tattoos. Hodlonaut wrote in a tweet Monday that he had issued legal proceedings against Wright in Norway.

McCormack, the podcaster Wright sued in April, is piling on as he awaits his day in court. McCormack wrote a satirical response to Wright's lawyers, saying, "I find it difficult to understand how I can affect the reputation of your client; this mistakenly states that he has any reputation left."

In addition to widespread derision, Wright's crusade has inflicted damage on his business interests. He's now pushing a coin called Bitcoin SV, which he says is Bitcoin the way Satoshi Nakamoto truly intended. Wright's lawsuits drew a harsh rebuke from Zhao Changpeng, the head of one of the world's largest cryptocurrency exchanges, Binance. Zhao said he was "against fraud," and then Binance delisted Bitcoin SV. The coin's market value plummeted 50% over two days, though it recovered during the broader cryptocurrency rally in May.

Wright and his few vocal allies are undeterred. On May 21, Wright said he was granted a U.S. copyright for early Bitcoin code and for the original whitepaper authored by Satoshi Nakamoto. Three days later, someone named Wei Liu filed a competing copyright claim. A spokesman for the agency says it "does not investigate the truth of any statements made."

Calvin Ayre, a dot-com-era gambling tycoon and the most persistent supporter of Wright, said he'd release evidence proving Wright's claim by the end of May. He didn't. "But now that we have somebody challenging the copyright, we can take that to a legal conclusion, which is what we are now trying to do," Ed Pownall, a spokesman for Ayre, wrote in an email.

Wright sees the insults as something more sinister than routine internet trolling. He says his detractors are criminals, who profit from human trafficking, and that their true motive is to sabotage his attempts to eliminate illegal uses of Bitcoin. "I designed Bitcoin to stop all of this," Wright says. "That is why they hate me."

Cryptocurrency Prices across Indian exchanges

Comments

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.