Bitcoin

Bitcoin’s Major 2020 Highlights – Review of Decisive Moments of Gold Mine

Sunday, January 3, 2021, was a special day for Bitcoin. That is right, it was on this day, that Bitcoin took birth on earth courtesy of Satoshi Nakamoto. 

A news post on cryptoglobe discusses the highlights of Bitcoin in 2020. The year was not a memorable one for many people due to the pandemic, but every dark cloud comes with a bright spot. 

The same can be said about Bitcoin. In this post, we will see some of the good things that were provided to millions of investors in Bitcoins. If you are a Bitcoin investor, then you would be delighted to know that it was not a completely bad year after all. 

  • March 12th saw Black Thursday

In the month of March 12th, the WHO (World Health Organization) formally announced COVID-19 as a pandemic. The market traders and investors in the crypto market were quite concerned and worried about the future holding. 

At the UTC time of the next day, the price of Bitcoin fell to $3600 on BitMEX. Because of a DDOS attack, the liquidations were put on hold. This allowed Bitcoin to recover and reach the $4000 level. 

PaulCrypto.com who is an avid cryptocurrency analyst had this to tweet on the highlights of bitcoin in 2020.

  • May 7th saw Paul Tudor Jones’ Bitcoin Investment Thesis

In the month of May 7th Bloomberg had claimed that Paul Tudor Jones II, who is a famous trader in asset management firm Tudor Investment Corp., had given a letter for his investors to know and read. 

Tudor has titled the letter the Great Monetary Inflation on his findings of Bitcoin in the crypto market. Tudor thought that it is a sublime inflation hedge asset. He went on to say that the fund can carry a low single-digit percentage in Bitcoin futures.

Tudor personally endorsed Bitcoin to get rid of the fears from novice investors who were not very keen on investing in Bitcoin. This also reduced the risk from the institutional investors who want to go easy on the cryptocurrency. 

  • August 11th saw MicroStrategy announce their first investment in Bitcoin 

In the month of August 11th, MicroStrategy (NASDAQ: MSTR) said that they are going to make investments in Bitcoin. They followed it up by purchasing 21454 bitcoins for $250 million. They did it as a primary treasury reserve asset.

Nearly after 5 months, the CEO of the company said that they were holding more than an aggregate of 70470 bitcoins that were bought close to $1.1 billion. The average price rate of the bitcoin was $15000. 

October 8th saw Square investing close to $50 million 

In the month of October following the footsteps of MicroStrategy, Square too on October 8th NYSE: SQ invested $50 million on Bitcoin. They did it by purchasing close to 4700 bitcoins at an aggregate price of $50 million. 

  • November 6th saw William H. Miller III supporting Bitcoin strongly 

When a commodity gets strong support from a popular individual on the planet, then one gets to know that it is something to invest in. The same happened on November 6th, with a popular American value investor William H. Miller III, claiming Bitcoin’s staying power is one of the best. 

Miller said that during an interview on CNBC. Miller felt that the Bitcoin comes with a sublime staying power when compared to other investment commodities. It is not often one can get to hear comments on this size of proportion. 

Additionally, Miller is the Founder and Chief Investment Officer of Miller Value Partners. It is the investment firm and Miller is also the portfolio manager of mutual funds. A report on Business Insider claimed that Miller also said that, Bitcoin is the single best performing asset class.

Miller has not seen this kind of performance from any asset close to a ten-year period. He went on to add, that Bitcoin is quite simple and easy to understand. Probably that is why many people want to invest in it. 

It is growing at more than 2.5% annually. However, he does add some caution to the wind claiming, it is volatile also. But the staying power makes it a solid investment option that investors might want to consider in without fear. 

Siamak Masnavi works for CryptoGlobeInfo which is an independent news division of CryptoCompare has this to tweet about the development.

  • November 9 saw Stanley Druckenmiller explaining Bitcoin better than gold

Stanley Freeman Druckenmiller, who is an American billionaire investor, claimed to have said that Bitcoin was more effective than gold as an investment option. Stanley was initially apprehensive about investing in Bitcoin. 

Like many others, he was not too keen to do so. Stanley is among the 400 lists of billionaires mentioned on Forbes and is ranked as the 167th richest in the United States of America. Stanley has a fortune of around $4 billion.

Stanley began his career life in the 1970s as an equity’s analyst in the Pittsburgh National Bank. Stanley founded an investment firm known as Duquesne Capital Management. He did it the year 1981 and the firm ran impressively until August 2010, when he closed it. 

Recently, Stanley said in an interview with CNBC that he indeed owns BTC holdings. However, amounts of holdings were not mentioned or verified by him. Stanley always believes that gold holds more value than any other commodity. 

But the 67-year-old billionaire has been swayed by the fact that Bitcoin is too hard to ignore. Like more investors, he too has understood the value of the BTC and rightly purchased some of them. 

Stanley says that Bitcoin has been growing strongly for 13 years now. That itself is a good sign of the things to come. Though he accepted he owns more in gold investments, his BTC investment will be more in the year to come, because it is thinner and has a lot more beta to it. 

The above was some of Bitcoin’s major highlights in 2020. Hope you found the post useful and may consider investing in Bitcoins if you have still not yet done so. Bitcoin is here to stay folks because you heard all the famous investors saying so, why not invest in it today.

Ten Years Ago, Satoshi Nakamoto Bitcoin’s Inventor Logged Off Today

Satoshi Nakamoto, who was considered as the inventor of Bitcoin, logged out today for good, more than ten years ago. 

A news post on Bitcoin News claimed that a pseudonymous programmer or group of programmers who took the name Satoshi Nakamoto logged out for the last time. The individual who took the name logged into bitcointalk.org, a Bitcoin forum, announced that he/she was leaving for good. 

One day before logging into the Bitcoin community, Nakamoto has written a final message to them, providing some advice to the other developers and like-minded forum users. Nakamoto said that there is plenty of work to be done on denial-of-service (DoS) attacks.

Idelto that is a Bitcoin news publisher, had this tweet on the news. 

Ten years ago, the term Bitcoin was in its baby stage, and not many people in the world even had a small idea of what they were dealing with. Hence, the inventor of Bitcoin was always a mystery. 

But the inventor was always there to lead the way to interested parties from 2008 to 2010. Nakamoto also added that he has some DoS limits and removed the safe mode. This message was written by Nakamoto on December 12th, 2010, which is more than a decade. 

Nakamoto also said that users want to run with the ‘disablesafemode’, but he felt that it is much better not to use it for appearance. That is because it was not a feature to be used long term. Safe mode can trigger looking at the total PoW invalid blockchain.

Surprisingly the username Nakamoto was extremely active on the forum and answered all queries for users during the initial weeks of December 2010. Those days, white Bitcoin or BTC was running for $0.20 per coin. 

Nakamoto had left a cryptic message saying that Bitcoin has other qualities that they can focus on. It was in response to an article on Wikileaks in pcworld.com titled, “could the Wikileaks scandal lead a new virtual currency?” However, some people felt that Wikileaks was paying close attention to Bitcoins that may have upset him. 

Why Nakamoto left abruptly is going to be never known to anybody.

What is Satoshi’s Vision?

People who aren’t that into crypto might not understand just how… biblical the whole thing can be.

On the surface, there are the interesting debates about the potential use cases, the stories of insane gains and heartbreaking losses ($85 million spent on two pizzas – never forget). There are plenty of interesting figures in the space to provide us with juicy drama as different camps choose their heroes and villains, but the most influential figure of all is most notable by their absence.

Satoshi Nakomoto.

Like an absent God watching from afar, Nakomoto gave cryptocurrency and blockchain the gift of life and then promptly bailed out with their billions of dollars worth of Bitcoin as far as anyone can tell, leaving the community to bicker over how the Great One would have wanted it to be. You have different factions squabbling over their differences in belief, each claiming that Nakomoto is on their side, but it’s difficult to say what he, she, or they would really have wanted.

I’ve written on the mystery of Nakomoto’s identity in a previous article, and in it I voiced the opinion that their absence isn’t selfishness or cowardice, but a conscious decision to create a leaderless movement that thinks for itself with no figurehead for governments to try to take down, weakening the currency in the process.

With no God at the helm, the Bitcoin project has its own free will, and the civil war between BTC and BCH rages without any divine intervention. Whether mining pools control the hash rate or not, Bitcoin is certainly decentralized in one way – nobody’s in charge. The creator won’t weigh in on what the right direction to take is, and because they’re in the ether, they can never be framed or arrested or targeted in a way that would harm Bitcoin. That strikes me as a great idea, but it begs the question – what did Satoshi Nakomoto want for Bitcoin, and if they’re not here any more, does that even matter?

Scalability: Bigger Blocks or Second Layers

There are a lot of issues in Bitcoin, and at the forefront is the issue of how to scale the network to allow for greater volume of transactions as the userbase increases and Bitcoin smashes the establishment and creates a utopian new world order where everyone is free to live in an anarchistic nirvana of their own choosing becomes more widely used as a currency or store of value. Ahem.

This was of course the main reason for the hard fork that split the currency into BTC and BCH, with the former advocating for second layer protocols like Segwit and the Lightning Network and the latter opting for bigger block sizes with no second layer on top of the Bitcoin blockchain.

The arguments for either are as numerous as they are bitterly proclaimed from the battleground of crypto forums and social media platforms everywhere, with BTC supporters insisting that bigger block sizes will lead to further centralization and the BCH side claiming that their version of Bitcoin is the true Bitcoin outlined in Nakomoto’s scripture white paper.

Interestingly, much like any old timey religion worth its salt, there are a number of gospels to choose from. Nakomoto didn’t just drop off the face of the earth after launching Bitcoin, and there are forum comments from 2009 and 2010 that most people agree are written by the enigmatic figure on the subject of Bitcoin.

Dan Larimer Meets The Maker

Dan Larimer is best known for his creation of Steem and the invention of the Delegated Proof of Stake system of verifying blockchain transactions, which is used by cryptocurrencies like EOS and Lisk. Many in the blockchain community see him as a central figure and a community leader, and in 2010 he went toe to toe with none other than Satoshi Nakomoto over the scalability of Bitcoin in a bitcointalk.org thread.

A user named Red sparked it all off with this question:

I’m curious about the developers feelings on scalability. For example, could the system handle a million users, doing say 5 transactions each per day. 5 million transactions per day is roughly 35,000 transactions per 10 minute period? Is there a bottle neck in propagating 35,000 transactions to a million nodes for block generation? Or has that issue been designed for?

Under the name “bytemaster”, Larimer weighed in first:

I am convinced that bandwidth, disk space, and computation time necessary to distribute and “finalize” a transaction will be prohibitively expensive for micro-payments. Consider for a second that the current banking industry is unable to provide a reasonable micropayment solution that does not involve depositing a reasonable sum and only allowing a withdraw after a reasonable sum has been accumulated.

Besides, 10 minutes is too long to verify that payment is good. It needs to be as fast as swiping a credit card is today.

Satoshi followed shortly afterwards with the following rather snarky response:

The current system where every user is a network node is not the intended configuration for large scale. That would be like every Usenet user runs their own NNTP server. The design supports letting users just be users. The more burden it is to run a node, the fewer nodes there will be. Those few nodes will be big server farms. The rest will be client nodes that only do transactions and don’t generate.

Quote from: bytemaster:
“Besides, 10 minutes is too long to verify that payment is good. It needs to be as fast as swiping a credit card is today.”

See the snack machine thread, I outline how a payment processor could verify payments well enough, actually really well (much lower fraud rate than credit cards), in something like 10 seconds or less. If you don’t believe me or don’t get it, I don’t have time to try to convince you, sorry.

Larimer responded that he had already read the snack machine thread in which Nakomoto explains how Bitcoin avoids double spending, and said that he had had come to the same conclusion as Nakomoto.

So what’s the vision already?

Here’s the thing. An argument could be made that Nakomoto’s vision doesn’t really match either camp, and wouldn’t really have ever worked in the first place. Far be it from me to question the infallible creator of the crypto that started it all, but Nakomoto’s vision, apart from being vehemently claimed by both BTC and BCH supporters, also included something that neither camp bargained on – direct leadership.

It may sound strange in the current climate where Nakomoto is a legendary figure to endlessly bicker over, but at one point they seemed to intend to stick around and lay down the law.

It can be phased in, like:

if (blocknumber > 115000)
maxblocksize = largerlimit

It can start being in versions way ahead, so by the time it reaches that block number and goes into effect, the older versions that don’t have it are already obsolete.

When we’re near the cutoff block number, I can put an alert to old versions to make sure they know they have to upgrade.

In that particular thread, Satoshi essentially said that they’d be the one to decide how things were going to be by “putting out an alert” to the miners to instruct them to change consensus. Yes, in this case they’re suggesting a block size increase, but they’re also suggesting what is essentially direct centralized leadership.

So why the change of heart? Nakomoto never really issued a goodbye, but simply dropped off the radar one day in 2010. Maybe the government got to them, maybe they had a change of heart over direct leadership, maybe they went into hiding – maybe they died. Who knows.

What we do know is that Nakomoto got the ball rolling and gifted the world with an incredible technology that has the potential to change everything. That’s their contribution. Had they stuck around, they may have found that the reality of one figure telling the community what to do would never have worked, and maybe that’s why they disappeared. Vitalik Buterin nearly got skinned alive on social media over the mere suggestion that there was some kind of secret meeting to establish a “plutocratic government” to call the shots with Ethereum consensus.

It just wouldn’t happen. A major feature of Bitcoin is that nobody’s in charge, but Satoshi’s famous vision may have evolved as time went on. Can’t think of everything, right?

Hands down the best thread I’ve read on this is this one where users discuss what Satoshi’s vision was only to be bombarded with people saying it didn’t matter, and that Bitcoin had exploded beyond the vision of one person to a decentralized community around the world. People are arguing that Nakomoto would likely have welcomed the fork to explore both options, that they left the scene to promote community decision making, and that the community are the ones who should decide, not the creator – personally, I agree with all of those points, but the important thing is what you believe.

Bitcoin is seen by many as a self-empowering tool. Money 2.0, blockchain technology enabling peer-to-peer payments and much, much, more, and above all, taking the power from authority figures and putting it in the hands of the public.

So don’t take my word for it – take a look at the thread, take a look at the information that’s out there, and decide for yourself – what is Satoshi’s Vision, yes, but even more importantly – do we need it, now that Satoshi gave us the power to decide on a vision of our own?

Interested in other cool crypto posts….check out Mining Wars: Bitmain vs Dragonmint and The Price of Bitcoin vs Cost of Mining.

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Who Invented Bitcoin?

In 2009, the world changed forever.

A software developer who had written a paper the previous year called “Bitcoin: A peer to peer electronic cash system” put their money where their mouth was, and released the software that allowed the world to share digital currency between themselves without government regulation or interference. This software, and the currency it allowed, was called Bitcoin.

While there have been countless theories, many of which we’ll examine below, the question of who the true inventor of Bitcoin really is has left journalists, cryptocurrency pundits, and even world governments in the dark. It is known that Bitcoin was invented by someone calling themselves “Satoshi Nakomoto”, but it’s unclear whether this was one person, or a group of people – all we know is that the name itself is almost certainly a pseudonym. Satoshi is a Japanese name meaning “clear thinking and wise”, while Nakomoto means “central origin, one who lives in the middle”.

No developer with the legal name Satoshi Nakomoto has ever come forward to claim the invention of the cryptocurrency, and the obvious connotations of the name mean that there’s nothing to really suggest that the inventor or inventors are even Japanese. Satoshi Nakomoto could be from anywhere, and people from England, Australia, South Africa, and many other countries have claimed or been heralded by others as the now fabled creator of the most famous and valuable cryptocurrency in the world.

Efforts to find the inventor have been plagued with hoaxes, doxing, hacking and police raids – it’s a wild ride. Let’s take a look at some of key figures.

Nick Szabo

One of the first people to be “accused” of being Nakomoto is an American computer scientist named Nick Szabo. In 2013, a blogger named Skye Grey wrote an extremely detailed research article conducting stylometric analysis on the Bitcoin whitepaper. Grey defended his claims in a measured and neutral interview with TechCrunch.com at the end of the same year.

In the interview, Grey began by saying he could not be 100% certain that Szabo was Nakomoto, but he did voice his certainty that only 0.1% of cryptography researchers could have written the whitepaper, and that Szabo was one of them. Grey pointed to several pieces of evidence which he admitted were circumstantial that nonetheless drew a strong connection between the mysterious Bitcoin creator and Nick Szabo. They included:

• The fact that a few months before the release of Bitcoin, “Nick was searching for technical collaborators on the bit gold project” which was a very similar cryptocurrency. After Bitcoin’s release, the bit gold project went silent.

• In the Bitcoin whitepaper, Satoshi didn’t cite Szabo’s work, whereas “other, less related cryptocurrencies” were cited.

• Szabo didn’t really have much to say publicly about the release of Bitcoin, despite the fact that “a decentralised currency like Bitcoin had been a major project of his for 10 years”.

• When Bitcoin was released, Szabo “deliberately post-dated his bit gold articles” to make it look like it was developed after Bitcoin, according to Grey.

It’s all very compelling, to be sure, but there’s no proof, and Szabo has repeatedly denied the claims that he his actually Satoshi Nakomoto. Possible? Certainly. Definitive? No. Moving on.

Dorian Nakomoto

In another intriguing case, a journalist named Leah McGrath Goodman linked an American called Dorian Nakomoto to the creation of Bitcoin. Dorian’s birth name was actually Satoshi, a trained physicist who worked on computer engineering projects in the private and military sector. Goodman pointed out that:

• Nakomoto had encouraged his daughter to pursue a career where she wouldn’t be “under the government’s thumb”, a thinking very much in line with the values of cryptocurrency advocates and developers.

• Goodman wrote that Nakomoto admitted inventing Bitcoin in an interview with her, saying “I am no longer involved in that and I cannot discuss it. It’s been turned over to other people. They are in charge of it now. I no longer have any connection.”

While this seemed almost conclusive, Nakomoto later denied this, saying he had misinterpreted the question about Bitcoin as being related to his classified work with the US military, which he is prohibited from discussing. Nakomoto was plagued by journalists camping outside of his house and following him, but he stuck to his guns and repeatedly denied involvement.

Satoshi Nakomoto’s P2P account then posted the first message in five years saying “I am not Dorian Nakomoto”, but it is now widely believed that the account was hacked, leading to even more mystery and confusion.

Dorian’s harsh treatment at the hands of journalists overly eager to get the scoop caused him much hardship, and qualified as harassment in the eyes of many. One such person was central cryptocurrency figure Andreas Antonopoulos, who voiced his sympathies. Beyond that, he launched a fundraiser to allow members of the public to support and apologise to Nakomoto for the suffering caused by the 24/7 news coverage, appearing in a Reddit AMA to ask for funds as well as in a video beside Nakomoto himself, who thanked the 2000 members of the community who donated.

Craig Steven Wright

One of the most controversial and yet widely supported theories is that Australian computer scientist and academic Craig Steven Wright is the inventor. In this case, Wright himself claimed to be Satoshi. In 2015, publications Wired and Gizmodo launched parallel investigations based on anonymous tips that Wright was Nakomoto. Hours after Wired released their story, Wright’s house was raided by police in New South Wales, Australia. Australian authorities claim that this was an unrelated incident regarding a tax investigation, a story that many view to be highly unlikely.

What’s the evidence?

• Wright is a serial entrepreneur and a computer scientist

• He posted his intention in 2011 to launch the world’s first “Bitcoin bank”

• CEO of DeMorgan Ltd, a company “focused on cryptocurrency”

• Friendship with deceased computer forensics expert Dave Kleinman. Despite the fact that Kleinman died in squalor, documents shared with Gizmodo indicate that he possessed a trust worth hundreds millions of US dollars worth of Bitcoins before he passed away. Gizmodo cited a 2011 email from Kleinman to Wright saying “Craig, I think you’re mad and this is risky. But I believe in what we are trying to do.”

There are emails dating as far back as 2008 in which Wright claims to be the inventor of Bitcoin, long before it was in the public eye. Whether the documents in question are authentic is a hotly debated subject. When pressured to release evidence that he was the inventor, Wright vanished from social media after posting the following statement:

“ I believed that I could put the years of anonymity and hiding behind me. But, as the events of this week unfolded and I prepared to publish the proof of access to the earliest keys, I broke. I do not have the courage. I cannot.”

While an argument can certainly be made that Wright is our mystery-man, his claim is not helped is not helped by the fact that he isn’t at all shy about bragging, and has been caught lying about his qualifications on occasion, such as claiming to have a PhD in computer science instead of two Masters Degrees. Kleinman described himself in 2013 as “certifiably the world’s foremost IT security expert”, behaviour which many feel isn’t in keeping with Nakomoto’s low profile.

Most damning of all is the doubt cast on his claim by security researchers such as Robert Graham and Dan Kaminsky. According to them, Wright gained access to Nakomoto’s digital signature from a publicly available source, proving nothing. Despite the fact that three major news outlets almost simultaneously published and even supported Wright’s claims (BBC, GQ, and The Economist), experts came out of the woodwork to discredit the notion, leading to the BBC rephrasing their headline in a more neutral manner. One of the most famous and public cases of outing Nakomoto, Wright’s claim to fame is largely viewed as hoax.

So who’s the real Satoshi?

It’s a murky business, with many other candidates besides, such as Tesla/Space X founder Elon Musk, who also denies involvement. With theories abound, the problem is a difficult one to solve. Have we mentioned the inventor in this article? Or are they out there somewhere, watching from the shadows in the anonymity that has defined their “public image”? Let’s take a look at the name again.

Satoshi Nakomoto.
Clear-witted, one who comes from the centre. What is Satoshi trying to convey with this? Someone with a vision, who doesn’t come from any one place, who comes from the middle, from within all of us. The message is there for those who seek it – Nakomoto doesn’t want to be found.

Arguably, the inventor prefers to exist not as a person, but as a concept – an idea of someone with a clear vision for the future, who doesn’t represent any one country, but humanity as whole. With that in mind, perhaps it’s best that the question is never truly solved – perhaps it’s better that Satoshi Nakomoto continues to live on as a modern legend.

A mystery wrapped in a riddle inside an enigma…perhaps we’ll never know.

Conor Maloney is a content writer and an advocate of decentralized public control of finance. Follow him @WrittenCraft for more crypto news.

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