Bitcoin Surpasses $50,000 for the First Time

Bitcoin inventor Satoshi Nakamoto’s return could dramatically affect price of cryptocurrency, Coinbase warns

Should Nakamoto be dead, their $55 billion worth of bitcoins could be inaccessible forever

Adam Smith@adamndsmith
Friday 26 February 2021 08:42
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If the identity of bitcoin’s mysterious inventor, Satoshi Nakamoto, is ever revealed, it could lead to major changes in price of cryptocurrency, Coinbase’s IPO filings warn.

In documents presented to the Securities Exchange Commission, Coinbase said that the “cryptoeconomy... may be adversely affected if the markets for bitcoin and Ethereum (ether) deteriorate or if their prices decline, including as a result of the following factors” – one of them being “the identification of Satoshi Nakamoto, the pseudonymous person or persons who developed bitcoin, or the transfer of Satoshi’s bitcoins”.

Bitcoin was the first decentralized cryptocurrency – a digital currency generated, or ‘mined’, when a computer solves a complex mathematical problem.

Nakamoto is the unidentified author behind the white paper “Bitcoin: A Peer-to-Peer Electronic Cash System”; details are scarce about the individual, but he is suspected to be a man in his 40s who lived in Japan.

Nakamoto is unlikely to be Japanese, however, as his use of English idioms, as well as the bitcoin software not being documented or labelled in Japanese.

Should the mastermind of cryptocurrency return, a number of situations are possible based on who the individual – or individuals, as Satoshi Nakamoto could be a pseudonym for a group – might be.

Nakamoto is believed to hold around 1.1 million (worth around $55 billion at current prices) of the 21 million bitcoin that could exist in the world. As such, his existence has immediate socio-economic impact.

Should Nakamoto be dead, those bitcoins could be inaccessible forever. Cryptocurrencies are tied to a complex encryption key, with people losing millions because they cannot remember their passwords.

Coinbase’s IPO filing also notes that any “negative perception of bitcoin or Ethereum” could be another factor that affects its pricing.

In May 2020, a cryptocurrency transaction saw 40 bitcoins ($391,055) transferred from an account that had been dormant since 2009.

The account, which generated the coins on 9 February 2009 when they were worth zero US dollars, moved them on 20 May 2020, leading people to believe that it could have been Nakamoto moving them.

Coinbase’s filing also has some other interesting titbits, including the definition of the word “hodl” – a misspelling of ‘hold’ and often used as an acronym to ‘hold on for dear life – which is when cryptocurrency users “[hold] a crypto asset through ups and downs, rather than selling it.”

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