The Bitcoin had two faces

The Bitcoin saga has taken an interesting twist, with a revived print Newsweek announcing that it has found the reclusive inventor of the … er, well, what to call Bitcoin depends on whom you talk to and what week it is, but it’s generally considered either a full-feature alternative currency or a protocol for electronic money transfers. (And a dessert topping.) The Newsweek cover story is scheduled to be the first thing to appear on the cover of a physical magazine called Newsweek since December 31, 2012. It declares the inventor of Bitcoin, an elusive figure known on the internet only by the name “Satoshi Nakamoto,” to be … drum roll, please … a guy named Satoshi Nakamoto.

Newsweek’s Satoshi is a 64-year-old Japanese-American living in Temple City, California. “Satoshi Nakamoto” is the name on his birth certificate, although he goes by Dorian. Mr. Nakamoto has a physics degree and has done computer engineering for a number of military-industrial firms, as well as one online stock-price provider. Much of his work history is shrouded in official secrecy, or perhaps just the habitual truculence of defence-tech professionals. He is known to have a libertarian streak, has had some run-ins with the financial system, and is thought by friends and relatives to capable of cooking up something like Bitcoin.

But it is now looking as though he had the square root of bugger-all to do with it. Newsweek concluded its investigation of Dorian S. Nakamoto with a police-supervised doorstep interview in which the gentleman is supposed to have said “I am no longer involved in that and I cannot discuss it. It’s been turned over to other people.” Dorian has now told the Associated Press that when he said “no longer,” two words on which Newsweek hung an entire feature, he was referring to the engineering profession generally. He denied being involved in any way with what he repeatedly called “Bitcom,” explained the work he had briefly done for a financial-information company, and read the Newsweek piece to himself, displaying increasing confusion and annoyance as he did so.

I have to say, having read New Newsweek’s article, that it does appear to rest on a fairly slender foundation. Aside from that “no longer,” the evidence that Dorian Satoshi Nakamoto equals “Satoshi Nakamoto” amounts to the obvious coincidence of names and a bunch of quotes from the man’s semi-estranged family. Unfortunately, neither “Satoshi” nor “Nakamoto” are uncommon names for individuals of Japanese ancestry; the article acknowledges that there are several more Satoshi Nakamotos just in the United States. The Bitcoin-inventing “Satoshi” clearly does not much want to be found; the name is obviously a pseudonym, has always been taken to be one until now, and was probably chosen precisely for its red-herring flavour.

The uptalking reporter’s other failures in Bayesian-style detective reasoning would appear to include cultural ones as well. Dorian’s children don’t have a very solid understanding of his work life and aren’t close to him. He strikes them as solitary, meticulous, and unapproachable. His daughter says “he’s not totally a normal person.” Leah McGrath Goodman makes a great deal out of all this; I can’t help wondering how it strikes readers who come from east Asian families.

A lot of people are asking how something like this could happen to Newsweek, not realizing that the Newsweek nameplate has basically been asset-stripped and repurposed in order that the remaining credibility and familiarity might be squeezed out of it. (This will happen to Maclean’s someday—two years from now, or 200. I’m hoping it’s 200.) No one expected this cred-squeezing process to happen quite so quickly and powerfully, but IBT Media, buyer of Newsweek, seems to have blundered into a singular piece of ill luck: the wrong reporter matched at the wrong time with the wrong story, one in which an informed intuition about any number of subjects might have saved the day.

As I’ve made obvious, I’m a Bitcoin detractor, or at least a critic of Bitcoin-as-currency. The fallacy underpinning Bitcoin, considered as money, can be found in the logical proposition “All money is ultimately founded on shared illusion; therefore, illusions, if shared widely enough, can be transformed into money willy-nilly.” With that said: every expert who has looked closely at the Bitcoin code believes it to be largely the work of one person. Whoever that person is, he appears to have carried out, almost single-handed, the creation of a completely new kind of financial instrument. He brilliantly anticipated various species of attack and critique in the design of Bitcoin, and has made provisions in the code for a bewildering universe of potential new applications for sales, labour, and other contracts.

Bitcoin may be doomed, but it bears the claw-mark of a very formidable lion. I cannot help feeling as though I would recognize the kind of person who might have invented Bitcoin. (Think about the five or ten most intelligent humans you’ve encountered, ever.) This may be hubris or madness on my part, for great things have sometimes been accomplished by unprepossessing men. But this poor Dorian fella just doesn’t fit the picture.

At this hour, Newsweek is standing by its story and its reporter. This cannot be taken too seriously, for Newsweek has no other choice until the “Bitcoin’s Face” story is exploded completely, without possibility of evasion or denial. It has probably occurred to the editors of Newsweek that this may never actually happen. Their story isn’t strictly dead, as in dead-dead, until the “real” Satoshi Nakamoto is located and interviewed by someone else.