Craig Wright has never been beloved in the crypto space. The Australian computer scientist, infamous for claiming to be Bitcoin creator Satoshi Nakamoto, has found himself on the wrong side of pretty much everyone in the crypto industry. At the same time, Wright has also built a reputation for being one of the most litigious men in crypto.
While most of Wright’s lawsuits have been borderline useless, one is particularly drawing attention for the impacts it could very well have. In May, Wright took his claim of being Nakamoto to the British High Court. The outcome of that case could have significant implications for Bitcoin.
A Background to the Case - Who is Satoshi Nakamoto?
For as long as Bitcoin has been mainstream, the question of who created the asset has always been on the fans’ lips. Everyone knows the story - Bitcoin was created in 2009 in the fallout of the 2008 financial crash. The asset’s creator - the pseudonymous Satoshi Nakamoto - could very well be a person or a group of persons. No one knows.
While no one knows who Nakamoto is, there are some people with links to him. Hal Finney, a California-born software developer, helped Nakamoto develop the asset and even helped to mine the first ten BTC tokens. While he knows who Nakamoto is, Finney always denied being the Bitcoin creator. He eventually died in 2014.
Then, in 2016, Wright burst into the scene. The computer scientist began going around and claiming to be Nakamoto. He “revealed” his identity to three publications - GQ, the BBC, and The Economist - using cryptographic keys that were tied to block 70, the first Bitcoin block.
Speaking to the BBC that year, Wright claimed that he was the major player in the development of Bitcoin. He added that while there was help from several people - including Finney - most of the work was his.
Ever since Wright came out with his claims, there has been no shortage of debate over whether the computer scientist is telling the truth or lying. Some believe him, and others think he’s no more than a charlatan looking for cheap press. Yet, despite the differing opinions, Wright hasn’t backed down. His website even states it boldly.
In 2019, Wright threatened to sue several people who publicly questioned the veracity of his claims. Then, in January of this year, he took several organizations - including Bitcoin.org - to court after publishing the Bitcoin whitepaper. As Wright explained, him being Bitcoin’s creator meant that he had a copyright over the asset's whitepaper.
The Uniqueness of This Case
Up until now, Wright’s case has largely remained minor. However, he has sought to get damages for what he believes is reputational harm, and he has also asked for injunctions for self-proclaimed copyright infringement - such as the case against Bitcoin org.
However, this latest case is a different monster entirely. According to a Reuters report, Wright is suing 16 defendants, asking that he be given the private keys to about 111,000 BTC held in two Bitcoin addresses. Wright claims that he lost the private keys last year after a hack on his home computer.
It goes without saying that this is momentous. If successful, the defendants would have to provide the coins to Wright. That in itself will destroy one of the most important features of Bitcoin - the fact that you can only access mined BTC through encrypted digital keys.
In an article, Peter Todd, a Bitcoin core developer and one of the defendants, in this case, explained the implications that Wright’s case could have. He said in part:
“If we allow people to get coins seized and reassigned by court order, that puts your coins at risk of being stolen by abuses of those fallible processes.”
The Chances of Success
The only saving grace that the market seems to have is that most of Wright’s cases have never exactly been successful. In fact, he still has a court case pending from the family of David Kleimann - another early Bitcoin developer who worked with Nakamoto.
Kleimann had worked with Wright and mined a substantial amount of BTC - worth billions of dollars today. When he died, Wright allegedly approached his family and asked for the tokens in exchange for cash. While he took the tokens, he never paid them.
Several other of Wright’s cases have ended up in losses for him, and his credibility has taken a substantial loss. So, he doesn't exactly have a lot of goodwill in the face of the court.
However, the chance that he wins this is still existent. If he does, Bitcoin’s price could take yet another tumble. With the asset trying to climb back atop $40,000, it is anyone’s guess what such a drop could do to its value.