Jack Kubinec

Fourteen years to the day after Satoshi Nakamoto published the famous Bitcoin <a href="https://bitcoin.org/bitcoin.pdf" target="_blank" rel="noreferrer noopener">white paper</a>, the first cryptocurrency’s once-meteoric growth is showing signs of slowing.



In June 2011, Bitcoin reached 25,000 <a href="https://www.blockchain.com/explorer/charts/n-unique-addresses" target="_blank" rel="noreferrer noopener">unique wallet addresses</a> active each day. By February 2015, it had 250,000. Bitcoin hovered a little under 600,000 unique daily addresses for most of 2017 — and had 668,000 unique addresses by the end of February 2022.



The number of bitcoins unspent for the past year reached an all-time high in September of 12.5 million bitcoins, or 65% of total circulating supply, per crypto analytics firm Glassnode. So, it may be that investors viewing bitcoin as <a href="https://cms.blockworks.co/bitcoin-a-stable-investment-volatility-dips-below-nasdaq-sp-500/" target="_blank" rel="noreferrer noopener">digital gold that holds value</a> despite a <a href="https://cms.blockworks.co/bitcoin-loses-6-equities-fall-as-inflation-exceeds-estimates/" target="_blank" rel="noreferrer noopener">hawkish Fed</a>, or retail traders <a href="https://crypto.cmail19.com/t/ViewEmail/d/5F1949D763E60AD62540EF23F30FEDED/961C6CC44A9474C2A29558A201773426?alternativeLink=False" target="_blank" rel="noreferrer noopener">giving up</a> trading during a bear market, are contributing to a slowdown in active addresses per day.



Yet, the total number of Bitcoin addresses continues to grow, exceeding one billion in July 2022, according to <a href="https://studio.glassnode.com/metrics?a=BTC&amp;m=addresses.Count" target="_blank" rel="noreferrer noopener">Glassnode</a>.



<h3>Bitcoin boomed with Big Tech</h3>



Bitcoin — which often trades <a href="https://decrypt.co/98201/bitcoin-is-trading-like-tech-stock-not-digital-gold" target="_blank" rel="noreferrer noopener">like a tech stock</a> — had an adoption rate exceeded by only, well, tech stocks. Facebook <a href="https://finance.yahoo.com/news/number-active-users-facebook-over-years-214600186--finance.html" target="_blank" rel="noreferrer noopener">boosted</a> users from 20 million to 200 million in two years. Twitter developed at a similar pace, from <a href="https://techcrunch.com/2008/04/29/end-of-speculation-the-real-twitter-usage-numbers/" target="_blank" rel="noreferrer noopener">200,000</a> to <a href="https://www.theguardian.com/technology/2012/dec/18/twitter-users-pass-200-million" target="_blank" rel="noreferrer noopener">200 million</a> active users in four years.



The trajectory of <a href="https://cms.blockworks.co/?s=twitter" target="_blank" rel="noreferrer noopener">Twitter</a>’s growth has dipped in recent years, from 330 million monthly active users in <a href="https://investor.twitterinc.com/financial-information/annual-reports/default.aspx" target="_blank" rel="noreferrer noopener">2017</a> to 345 million in <a href="https://www.insiderintelligence.com/insights/twitter-user-statistics-trends/" target="_blank" rel="noreferrer noopener">2022</a>.&nbsp;



Over the same period, Facebook grew from <a href="https://investor.fb.com/investor-news/press-release-details/2018/Facebook-Reports-Fourth-Quarter-and-Full-Year-2017-Results/default.aspx" target="_blank" rel="noreferrer noopener">2.1 billion</a> to <a href="https://s21.q4cdn.com/399680738/files/doc_financials/2022/q2/Q2-2022_Earnings-Presentation.pdf" target="_blank" rel="noreferrer noopener">2.9 billion</a> by the same metric.&nbsp;



As the tech boom of the past several years cools off, Bitcoin may be seeing its exponential growth weaken, too.



<h3>Proof instead of trust</h3>



“What is needed is an electronic payment system based on cryptographic proof instead of trust,” reads the Bitcoin white paper’s opening page.



Satoshi penned the Bitcoin white paper in late 2008, amid a financial crisis caused in part by bank negligence. The message of a trustless financial system hit home.&nbsp;



<blockquote class="wp-block-quote">“The more people that saw bitcoin as an alternative to gold or other base money, the more likely it became that other people would think the same. Eventually if enough people believe it, maybe the central banks believe it too, and then it&#8217;s real,” Greg di Prisco, partner at the blockchain venture fund Distributed Capital Partners, said in a Telegram message.</blockquote>



<h3>Bitcoin after the Merge</h3>



The white paper popularized proof-of-work, Satoshi’s blockchain validation mechanism that caused miners around the world to <a href="https://www.coindesk.com/layer2/miningweek/2022/03/21/what-does-a-crypto-mining-farm-look-like-striking-photos-from-siberia-to-spain/" target="_blank" rel="noreferrer noopener">fill warehouses with GPU rigs</a>.



But with Ethereum’s <a href="https://cms.blockworks.co/ethereum-switches-to-proof-of-stake-after-7-years-of-work/" target="_blank" rel="noreferrer noopener">successful Merge</a> to the more energy efficient proof-of-stake, crypto’s rising star left proof-of-work behind — though Satoshi’s white paper was key to its development.



“If there was no proof-of-work, we wouldn’t have ended up at proof-of-stake,” said Harsh Rajat, founder of the Ethereum-native Push Protocol.



Ethereum, with its army of developers implementing a <a href="https://twitter.com/VitalikButerin/status/1466411377107558402?s=20&amp;t=696lk0hW11ekaEAfq2e1-Q" target="_blank" rel="noreferrer noopener">multistep roadmap</a>, seems to have captured much of crypto’s imagination — and has steadily <a href="https://coinmarketcap.com/charts/" target="_blank" rel="noreferrer noopener">gained</a> on bitcoin’s market share since at least 2020.



By making the Ethereum blockchain far more energy-efficient, the Merge created “long term existential risks for Bitcoin,” Imran Khan, core contributor to Alliance DAO, told Blockworks via Telegram.



Not to be outdone, bitcoin’s <a href="https://www.theblock.co/data/on-chain-metrics/bitcoin/bitcoins-hash-rate-daily" target="_blank" rel="noreferrer noopener">hash rate</a> has actually increased since the Merge.&nbsp;



“I don&#8217;t see any compelling reasons to think that people are going to switch en masse away from proof-of-work to proof-of-stake,” said Patrick Scott, adviser to the DeFi platform Clip Finance.



With crypto still in its relative infancy, reading too much into Bitcoin’s future would be a fool’s errand.&nbsp;



Consider that there are <a href="https://cms.blockworks.co/a-13-year-old-from-india-raised-300k-for-his-latest-defi-project/" target="_blank" rel="noreferrer noopener">developers today</a> who were infants when Bitcoin began.



“Technology has a way of surprising us,” Rajat said of crypto’s future. “[But] the idea that was projected by Satoshi will remain in soul and spirit.”



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14 Years Since the White Paper: Can Bitcoin Keep Growing?

Macauley Peterson

<div id="highlights-block_6352e4d8463b9" class="highlights">
 <ul>
 <li>Granath’s statements were primarily inoffensive value judgements, with “a core of allegations of a factual nature,” the Oslo court observed</li>
 <li>The court chose not to take a position on the question of whether Wright is Satoshi, calling it “unclear”</li>
 </ul>
 
</div>



Craig Wright hoped to convince the world that he is Satoshi Nakamoto, but his dream took a hit Thursday when a Norwegian judge ruled that public comments ridiculing Wright’s claims were not unlawful or particularly offensive.



Magnus Granath, a Norwegian known online under the pseudonym <a href="https://cms.blockworks.co/?s=Hodlonaut" target="_blank" rel="noreferrer noopener">Hodlonaut</a>, called Wright “a very sad and pathetic scammer” and “a fraud” in a series of March 2019 tweets. The tweets were deleted a few weeks later, but not before they raised the ire of the Australian entrepreneur, who has asserted <a href="https://bitcoinmagazine.com/business/op-ed-how-many-wrongs-make-wright" target="_blank" rel="noreferrer noopener">since 2015</a> — with scant evidence — that he is Satoshi, the pseudonymous writer of the Bitcoin white paper.



Wright’s lawyers threatened to sue in the UK, unless Granath acknowledged Wright as Satoshi. Instead, Granath, the plaintiff in the Norwegian case, sought a judgment that his tweets were justified.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I won. Welcome to law.&mdash; hodlonaut 🌮⚡🔑 🐝 (@hodlonaut) <a href="https://twitter.com/hodlonaut/status/1583086284792205312?ref_src=twsrc%5Etfw">October 20, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



“Welcome to law,” is a reference to the closing line of <a href="https://archive.ph/xgeTI" target="_blank" rel="noreferrer noopener">Wright’s own 2019 screed</a>, when he vowed, “I am the person behind the moniker Satoshi Nakamoto, and as a result of all the trolls and haters, I’m going to provide evidence,” using “courts and law.”



At least one court has now declared the evidence still isn’t there. In the ruling by the Oslo District Court, Judge Helen Engebrigtsen concluded that Granath’s statements were not defamatory when weighed against his rights to freedom of expression.



“The court believes that Granath had sufficient factual grounds to claim that Wright had lied and cheated in his attempt to prove that he is Satoshi Nakamoto,” the ruling, <a href="https://www.docdroid.net/no5vRjP/translation-of-ruling-in-granath-v-wright-pdf#page=6" target="_blank" rel="noreferrer noopener">in translation</a> from Norwegian, states.



For years, Wright has purported to be the author of versions of the <a href="https://bitcoin.org/bitcoin.pdf" target="_blank" rel="noreferrer noopener">Bitcoin white paper</a> and the bitcoin code that predate the first known edition published by Satoshi in 2009.



Although the court cleared Granath of any liability for his statements and reviewed approximately 11,000 pages of documents, the judge was unwilling to rule on whether Wright was indeed the creator of Bitcoin.



<blockquote class="wp-block-quote">“Both parties in the case have pointed to circumstances that speak respectively for and against Wright being Satoshi Nakamoto,” Engebrigtsen wrote, adding, “The court chooses not to take a position on this, because it has no bearing on the outcome of the case.”</blockquote>



Courts have <a href="https://cms.blockworks.co/tag/craig-wright/" target="_blank" rel="noreferrer noopener">previously declined</a> to wade into the debate over Wright’s claim to the identity of Satoshi Nakamoto.



However, it was pertinent to the context around Granath’s tweets and, the judge wrote, “the court points out that the evidence brought in the case is not suitable to change the prevailing opinion that Craig Wright is not Satoshi Nakamoto.”



Wright was ordered to pay Granath’s legal fees amounting to about $385,000. Wright <a href="https://twitter.com/Dr_CSWright/status/1583122864336957441" target="_blank" rel="noreferrer noopener">tweeted</a> that he intends to appeal.



The lead attorney for Wright told Blockworks that they “do not agree with the court&#8217;s assessment that Granath’s communications were not defamatory in a legal sense,” noting that, “private citizens should enjoy the same protection on Twitter as on other media platforms.”



Wright, who lives in London, still has a pending defamation claim against Granath in England.



An attorney for Granath did not immediately return Blockworks’ request for comment.



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Craig Wright Not Defamed by Being Called ‘a Fraud,’ Judge Rules

<div id="highlights-block_6241d462f69f9" class="highlights">
 <ul>
 <li>Wright’s claim to be Satoshi Nakamoto was not at issue in this case</li>
 <li>The judge ruled that developers have no fiduciary duty to bitcoin owners</li>
 </ul>
 
</div>



Craig Wright, who claims to be Bitcoin creator Satoshi Nakamoto, suffered a new legal setback as a London court <a href="https://www.bailii.org/cgi-bin/format.cgi?doc=/ew/cases/EWHC/Ch/2022/667.html" target="_blank" rel="noreferrer noopener">ruled</a> developers have no fiduciary responsibility to aid the Australian computer scientist in accessing two wallets containing about $3.9 billion in bitcoins. 



Wright, whose company Tulip Trading Limited (TTL) brought the litigation, said he lost his private keys following a hack, and wants Bitcoin developers to assist him in regaining control of the assets. Judge Sarah Falk of the London High Court turned down that notion Friday.&nbsp;



The 16 defendants are all developers of Bitcoin-related software, and 12 are Bitcoin Core developers, the chain widely regarded as the canonical Bitcoin, or BTC.&nbsp; Wright’s company also laid claim against developers of several forks: Bitcoin Cash, Bitcoin ABC and Bitcoin SV (the fork that Wright himself says is “Satoshi’s Vision”.)



Wright maintains the two Bitcoin wallet addresses are his, via a series of Seychellois and Antiguan shell companies and trusts for which he and his wife Ramona Ang are beneficial owners.



Wright contends he stored the private keys in a password-protected file, with backups on two cloud storage servers, but that both the file and its backups were removed or deleted in a hack prior to Feb. 8, 2020.



The assets have not moved since the time of the alleged hack. Wright wants Bitcoin developers to push through a software update that would restore his access to the wallets. In fact, he offered to pay them to do so.



<blockquote class="wp-block-quote">“Apart from their shared interest in digital assets, there is very little common ground between the Claimant and the Defendants,” Judge Falk wrote, adding “a significant level of animosity exists which is much broader than, and the origins of which pre-date, the particular dispute before this court.”</blockquote>



For instance, the judge wrote, Wright’s claim that Bitcoin developers have the power to do what he asks is disputed.



The defendants point that Bitcoin development occurs among “a very large, and shifting, group of contributors without an organisation or structure,” and that even if they could alter the network software, miners and full node operators would just ignore such a change, as it goes against the community’s core values. At most, it would lead to further network forks, but not actually allow Wright to access the value locked in the bitcoins he seeks.



The extent of Bitcoin developers’ actual power bears directly on the key question in the case — whether the role and work of the Bitcoin developers itself creates a fiduciary duty to TTL, assuming Wright was in fact the victim of a fraudulent hack (which the developers also dispute).



“It is very hard to see how TTL&#8217;s case on fiduciary duty is seriously arguable,” Judge Falk wrote.



<blockquote class="wp-block-quote">“I do not think that bitcoin owners can realistically be described as entrusting their property to a fluctuating, and unidentified, body of developers of the software, at least in the sense and to the extent claimed by TTL.”</blockquote>



Even assuming TTL could establish the facts that it relies on in the course of a trial, the judge explained, there was no realistic prospect of establishing a breach of fiduciary duty owed by the developers to TTL.



Although the relationship between developers and bitcoin owners “generally has a fiduciary quality”, the judge wrote, their duty is not to any particular owner, to the detriment of others.



<blockquote class="wp-block-quote">“It is uncontroversial that a fundamental feature of the Networks, at least in their existing form, is that digital assets are transferred through the use of private keys. TTL effectively seeks to bypass that.”</blockquote>



The judge was not persuaded by TTL’s claim that Bitcoin developers owed a “duty of care” that was breached by allowing the network to operate in such a way that the private keys could be lost in the first place. Such a claim, she wrote, was not “realistically arguable.” They would have to have some contractual relationship with Wright or his companies. Otherwise, she noted, “by definition the potential class in this case is unknown and potentially unlimited.”



In other words, it would be ludicrous to open up bitcoin developers to legal jeopardy from anyone whose private keys were ever lost or stolen. The fact that TTL would pay them to try to gain access to the wallets further “underlines the weakness of its case,” Falk wrote.



Last December, following a trial in Florida, Wright <a href="https://cms.blockworks.co/verdict-in-craig-wright-civil-trial-100m-award-for-plaintiff-but-no-punitive-damages/" target="_blank" rel="noreferrer noopener">was found liable</a> for conversion — a form of theft — and ordered to pay $100 million to a company controlled by Ira Kleiman, the brother of Wrights’ former business partner, David Kleiman, with whom Wright once mined bitcoins.



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Bitcoin Developers Do Not Have a Fiduciary Duty to Bitcoin Owners, Judge Rules

<div id="highlights-block_61a416f02d14a" class="highlights">
 <ul>
 <li>Wright’s defense team declared victory, as their client avoided the worst outcomes</li>
 <li>The jury was initially unable to reach agreement last week but were instructed by the judge to keep trying</li>
 </ul>
 
</div>



Jurors in the Florida trial of Craig Wright, an Australian computer scientist who claims to have invented Bitcoin, were deadlocked as recently as last Wednesday, after several days of deliberations. The judge in the case, US District Judge Beth Bloom, issued what’s known as an <a href="https://www.law.cornell.edu/wex/allen_charge" target="_blank" rel="noreferrer noopener">Allen charge</a>, instructing them to “carefully reexamine and reconsider all the evidence” in an attempt to reach an agreement. Now they have.



On Monday, the jury found Wright liable on one of the plaintiff’s claims, that of conversion — unauthorized possession of personal property,&nbsp; in this case intellectual property — and awarded $100 million in damages, according to <a href="https://storage.courtlistener.com/recap/gov.uscourts.flsd.521536/gov.uscourts.flsd.521536.812.0_1.pdf" target="_blank" rel="noreferrer noopener">court documents</a>. Notably, no bitcoin was directly ordered to be paid.



Wright <a href="https://cms.blockworks.co/craig-wright-trial-goes-to-florida-jury-which-could-award-as-much-as-189b/" target="_blank" rel="noreferrer noopener">could have been found liable</a> for a range of behavior including fraud, theft, breach of fiduciary duty, with damages potentially reaching into the billions, therefore he and his legal team see the outcome as a victory.&nbsp;



“This has been a remarkably good outcome — I feel completely vindicated,” Wright told his supporters in a <a href="https://twitter.com/JimmyWinSV/status/1467910308953997314?s=20" target="_blank" rel="noreferrer noopener">recorded video message</a>.



The jury rejected plaintiff Ira Kleiman’s claim that his deceased brother David was a business partner of Wright’s, and decided that Wright would owe nothing to the David Kleiman estate. Instead, the sole monetary award went to W&amp;K Info Defense Research LLC, a company for which Ira Kleiman is now the only registered director, but that was once a joint venture between Wright, his wife at the time Lynn Wright, and David Kleiman.



In <a href="https://cryptopotato.com/wp-content/uploads/2020/08/lynn-wright-ira-kleiman-petition-071620.pdf" target="_blank" rel="noreferrer noopener">a separate legal maneuver</a>, the ownership of the company is an ongoing matter of dispute, and Lynn Wright contends that Ira Kleiman was “not authorized to act on behalf of W&amp;K Info Defense.”



Lawyers for Ira Kleiman, see the jury award as a win for their client, even if it falls far short of what they claimed:



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Kleiman v. Wright update: We are incredibly gratified the jury found Craig Wright has to pay our client, W&amp;K, $100,000,000 for the bitcoin-related assets he stole. This is a great win for our client and for justice!&mdash; Vel Freedman (@VelvelFreedman) <a href="https://twitter.com/VelvelFreedman/status/1467923812075421701?ref_src=twsrc%5Etfw">December 6, 2021</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



<h3>Satoshi Nakamoto’s bitcoin stash</h3>



The identity of Satoshi Nakamoto was not a subject of this case. It was simply assumed that Wright had access to Satoshi&#8217;s 1.1 million bitcoins, which could have been awarded as damages. The jury elected not to award any bitcoins, opting instead to levy money damages in dollars.



For Ira Kleiman to collect on the $100 million from Wright due to <meta charset="utf-8">W&amp;K Info Defense Research, he will first have to resolve the dispute over the company’s ownership. If he does retain control, and successfully turns the jury award into a definitive money judgment that Wright must pay, the question remains, where will the money come from?



Earlier in the trial, the initial judge, Judge Reinhart, <a href="https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-80176/pdf/USCOURTS-flsd-9_18-cv-80176-9.pdf" target="_blank" rel="noreferrer noopener">found</a> that Wright submitted forged documents and offered perjured testimony related to the production of a list of bitcoin addresses under his (supposedly Satoshi’s) control.



Wright has so far failed to prove that he is in possession of, or has access to, the private keys needed to move those early Satoshi-mined bitcoins. Absent such proof, he is unlikely to persuade <a href="https://bitcoinmagazine.com/business/op-ed-how-many-wrongs-make-wright" target="_blank" rel="noreferrer noopener">skeptics</a> that he is in fact Satoshi.



Wright disputes the consensus view of what bitcoin even is. In 2018, Wright’s <a href="https://www.gemini.com/cryptopedia/bsv-what-is-bitcoin-sv" target="_blank" rel="noreferrer noopener">preferred bitcoin, BSV</a>, which stands for “Bitcoin Satoshi’s Vision”, forked from the Bitcoin Cash (BCH) blockchain, which itself forked from the original BTC chain in 2017.



Speculators evidently view the trial outcome as beneficial for the prospects of the bitcoin fork — BSV has surged 34% in the past 24 hours and now as a market cap of just under $3 billion. That remains a far cry from the market cap of BCH at about $9 billion, much less the BTC market cap of $962 billion.




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Verdict in Craig Wright Civil Trial: $100M  Award for Plaintiff; No Punitive Damages

<div id="highlights-block_61a416f02d14a" class="highlights">
 <ul>
 <li>Wright’s defense team’s Motion for Judgment as a Matter of Law was denied on November 22, ensuring a jury decision</li>
 <li>Seven counts, including Civil Theft and Fraud, are now in a jury’s hands</li>
 </ul>
 
</div>



He claims to be the inventor of Bitcoin and the author of the original 2008 <a href="https://bitcoin.org/bitcoin.pdf">Bitc</a><a href="https://bitcoin.org/bitcoin.pdf" target="_blank" rel="noreferrer noopener">o</a><a href="https://bitcoin.org/bitcoin.pdf">in white paper</a>, under the pseudonym Satoshi Nakamoto. But the ultimate outcome of the civil trial of Dr. Craig Steven Wright, an Australian computer scientist, is unlikely to settle that mystery.



The United States District Court for the Southern District of Florida, however, accepts it as a given, by granting the plaintiff in the case standing to sue Wright in the first place. Although the prevailing view among Bitcoin proponents is that Wright’s assertion <a href="https://bitcoinmagazine.com/business/op-ed-how-many-wrongs-make-wright" target="_blank" rel="noreferrer noopener">is specious</a>, as far as Judge Beth Francine Bloom is concerned, Wright has 1.1 million bitcoins.



The jurors, slated to resume deliberations on Monday after a Thanksgiving break, are tasked with passing judgment on a more limited question: whether Wright is guilty of fraud, theft, breach of fiduciary duty, and a handful of other counts that could leave him liable for half of the bitcoin stash that he may have mined in Bitcoin’s early days.&nbsp;



The plaintiff in the case, Ira Kleiman, says that the <a href="https://cms.blockworks.co/bubbles-bitcoin-and-whats-next/" target="_blank" rel="noreferrer noopener">bitcoin,</a> while ostensibly Wright’s, rightfully belongs to the estate of Kleiman’s deceased brother David, a friend and alleged business partner of Wright’s. David Kleiman died in April 2013 at the age of 46, without ever laying hands on the fortune his brother now says should be his.



Ira Kleiman initially sued Wright in February 2018, claiming that Wright schemed to steal both the 1.1 million bitcoins and the intellectual property connected with Bitcoin’s open-source code that David Kleiman may have helped develop. At the time of the original suit, the quantity of bitcoin at issue was valued at just over $10 billion. The stakes are somewhat higher now — that much bitcoin is worth some $60 billion dollars today.



If the jury of three men and seven women finds that Wright had a partnership with David Kleiman to mine those coins, assuming they are in fact under Wright’s control, they will have to determine the value owed to Kleiman’s estate, plus any punitive damages — and the plaintiffs&#8217; lawyers have asked for plenty — bringing the total claims and damages to $189 billion. (For comparison, the world’s richest person, Amazon founder Jeff Bezos, is worth $177 billion and just the $30 billion in bitcoin alone would put Ira Kleiman among the top 50 richest people in the world, <a href="https://davidgerard.co.uk/blockchain/2021/11/13/news-craig-wright-in-court-mt-gox-settlement-bitcoin-futures-etf-reddit-community-points-miners-still-cant-sell-their-bitcoins/" target="_blank" rel="noreferrer noopener">according to Forbes</a>.)



Ira Kleiman <a href="https://www.law360.com/articles/1438959" target="_blank" rel="noreferrer noopener">has testified</a> that Wright and his brother created a company in Florida in 2011 — W&amp;K Info Defense Research LLC — which is how the Australian has ended up spending time in and out of a Miami courtroom <a href="https://news.bitcoin.com/judge-orders-craig-wright-to-physically-appear-in-florida-lawsuit/" target="_blank" rel="noreferrer noopener">since 2019</a>.



Wright denies the allegations, and says Kleiman merely helped him temporarily transfer control of the bitcoin — which <a href="https://www.law360.com/fintech/articles/1439426/bitcoin-inventor-accused-at-trial-of-lying-about-trust" target="_blank" rel="noreferrer noopener">he says</a> was purchased in 2011 from a &#8220;dodgy&#8221; Russian exchange — to keep it out of reach of Australian tax authorities.



<h3>A last-ditch effort to avoid a jury verdict</h3>



Shortly before closing arguments last week, Wright’s legal team filed a Motion for Judgement as a Matter of Law — basically an appeal to the judge that the plaintiffs haven’t presented sufficient evidence. Such a preemption by the judge is only an option if there “is no legally sufficient evidentiary basis for a reasonable jury to find for the non-moving party.” According to <a href="https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-80176/pdf/USCOURTS-flsd-9_18-cv-80176-25.pdf" target="_blank" rel="noreferrer noopener">court documents</a>, there is, and the motion was denied.



The court previously <a href="https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-80176/pdf/USCOURTS-flsd-9_18-cv-80176-23.pdf" target="_blank" rel="noreferrer noopener">denied a motion</a> from the defense for Summary Judgement, which uses a similar legal standard, so this last legal maneuver was a long shot.



Among the Wright team’s arguments was that the market value of the bitcoins at issue could not be used as the basis for the jury judgment under a Florida precedent known as the “Blockage Discount Theory” —&nbsp; that the bitcoin could not be sold without substantially adversely affecting the price. The judge disagreed.



<h3>To be or not to be Satoshi Nakamoto</h3>



Wright has never been able to prove that he is Satoshi Nakamoto by either signing a message using the PGP key for Satoshi’s encrypted emails, or moving any of the early Satoshi-mined bitcoin he presumably should control.



The case has yielded more sordid details of Wright’s behavior. In March 2020, a previous judge in the case, Judge Bruce E. Reinhart, <a href="https://storage.courtlistener.com/recap/gov.uscourts.flsd.521536/gov.uscourts.flsd.521536.420.0.pdf" target="_blank" rel="noreferrer noopener">reprimanded Wright</a> for forging documents and giving perjured testimony.



Gavin Andresen, who once claimed that he was personally convinced Wright was indeed Satoshi, expressed doubts on that view in <a href="https://storage.courtlistener.com/recap/gov.uscourts.flsd.521536/gov.uscourts.flsd.521536.589.3.pdf" target="_blank" rel="noreferrer noopener">a sworn deposition</a> during the trial, referring in particular to supposed proof proffered by Wright:



<blockquote class="wp-block-quote">“That gobbledygook proof that he published was certainly, deception, if not an outright lie. So at the very least, that, I consider, you know, that — he bamboozled me there.”</blockquote>



When Wright set a date to prove his claims — by transferring bitcoin known to belong to Satoshi Nakamoto to Andresen — he failed to deliver. On the day that he was due to transfer the bitcoin — May 4th, 2016 — Andresen says he was told Wright attempted suicide and was taken to the hospital.



Wright is now in a precarious position. If the jury finds in Kleiman’s favor, it is unlikely that Wright will be able to access the half a million in bitcoin — whether or not he is Satoshi — for one simple reason: It’s almost inconceivable that he would not already have done so. Satoshi’s coins have not moved for over a decade, even as the price of 1 bitcoin has gone from less than a penny to $68,521. That’s the clearest indication that Satoshi is either dead, or has lost the keys.



As <a href="https://davidgerard.co.uk/blockchain/2021/11/13/news-craig-wright-in-court-mt-gox-settlement-bitcoin-futures-etf-reddit-community-points-miners-still-cant-sell-their-bitcoins/" target="_blank" rel="noreferrer noopener">David Gerard put it</a>, “Wright could end up owing half a million bitcoins he doesn’t control to the estate of the guy he didn’t invent Bitcoin with, just because he wouldn’t admit he wasn’t really Satoshi.”



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