Possibly the one thing everyone agrees on about the creator of the bitcoin digital currency is that ‘Satoshi Nakamoto’ is a pseudonym. ‘Satoshi’, whose seminal 2008 white paper and software created a digital currency now worth some £660bn, signed off from the project in 2010. By general consensus, he, she – or they – then disappeared.

While Satoshi is a Japanese boy’s given name and Nakamoto is a bland blend of two common Japanese kanji characters (naka means ‘middle’ and ‘moto’ origin, root or, by extension, book), whoever they were wrote in colloquial British – or Australian – English. And there the consensus ends.  

On Monday, amid worldwide interest, a High Court hearing opens in London to resolve the most bitterly contested element of the mystery. An alliance of mainly US bitcoin developers, the Crypto Open Patent Alliance (COPA), is asking the court to declare that the Australian-born and English-resident computer scientist Dr Craig Wright (pictured) is not Satoshi. Wright will vigorously contest this.

Meanwhile, in a separate, though joined, matter, Wright is suing the developers for alleged infringement of database rights in the bitcoin blockchain (the permanent encrypted record of transactions which prevents bitcoins from being forged or ‘double spent’).

Both sides in the case claim to be acting to preserve the true spirit of bitcoin, envisaged by Satoshi as an open source peer-to-peer currency rather than a speculative bubble.

COPA says it is acting for the ‘bitcoin community’ against the ‘chilling impact’ of lawsuits by Wright, who over the past five years has asserted his copyright in the Satoshi white paper. Several people who have challenged this claim publicly have faced libel actions. By seeking a declaration on the ‘identity question’ COPA says it is standing up to what a spokesperson described as Wright’s ‘bullying’.

The identity case is expected to hinge on expert analysis of documents on computer memory sticks which Wright says he found in a drawer at his home last year. Wright will maintain that these will show his work leading up to the registration of www.bitcoin.org in 2008 and the minting of the first bitcoins in January 2009. (The blockchain contains the front-page headline of The Times on 3 January, 2009.)

COPA is expected to argue that the documents could not have been generated when Wright claims, producing expert evidence showing they were created with software and include fonts that did not exist at the time.

Wright, meanwhile, offered an unexpected olive branch this month with a public offer to settle ‘to draw a fresh start in the history of bitcoin to guarantee its success in whatever form it takes’. Terms of the ‘non-negotiable’ offer were set out in a half-page advertisement in The Times this week. ‘The focus of my various litigations to date has never been on revealing my pseudonymous identity as Satoshi Nakamoto, but on mandating that bitcoin remains faithful to its central principles,’ his statement said. With this in mind he offered ‘to waive my database rights and copyrights’ and to offer ‘an irrevocable licence in perpetuity to my opposing parties’.

‘I offered a settlement because that is the correct thing to do in a case,’ Wright told the Gazette.

‘Hard pass,’ COPA responded, stating that Wright’s offer still implies he has a licence to give away – and there is nothing to prevent him renewing action in the future.  

Both sides have also recruited top-flight legal advisers. COPA’s case will be led by Jonathan Hough KC, instructed by international firm Bird & Bird. Alex Gunning KC, instructed by Macfarlanes, will appear for the developers. Wright’s team includes Lord Grabiner KC and Craig Orr KC, instructed by Shoosmiths. Both sides have also retained public relations teams.

Whether their efforts will impress Mr Justice Mellor, a highly tech-literate IP specialist who has shown a firm hand for case management in the run-up to the main hearing, remains to be seen. The case is due to run into next month, with closing statements due from 12 March.   

Wright, meanwhile, offered his own thoughts on England and Wales, his jurisdiction of choice. ‘Legal formalism is important,’ he told the Gazette. ‘This requires that judges follow the letter of the law and don’t interpret it as an activist. This is critical in a democracy because the social issues being addressed should not be addressed by the judiciary. One of the reasons I like British law is that we maintain the standards unlike in the US where judges are interpreting the law rather than applying it.’

The bitcoin community can only hope that the application of the law is sufficient to put this aspect of the Satoshi mystery to rest.

 

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