David Canellis

Decels, or decelerationists, are back in the spotlight thanks to the OpenAI soap opera. Sam Altman’s momentary ousting was, in one <a href="https://www.nytimes.com/2023/11/21/technology/openai-altman-board-fight.html">version</a> of the story, an attempted coup by safety-obsessed doomers who worried he couldn’t be trusted to build such powerful technology.



Or, depending on which reports you believe, it was a move to <a href="https://www.washingtonpost.com/technology/2023/11/22/sam-altman-fired-y-combinator-paul-graham/">mitigate</a> Altman’s own hunger for corporate power.



And the US Securities and Exchange Commission is the top US “decel,” said former Kraken CEO Jesse Powell in response to a recent securities suit brought against the crypto exchange he co-founded.



Both debacles have shown us a fresh, exciting way to divide us by our philosophies: Are you a progress-loving accel (accelerationist) who embraces innovation at all costs, or are you an anxious decel eager to slow tech entrepreneurs down?



Accels would say amplifying capitalism is critical to humanity. They say we need more money, more funding and more entrepreneurs to discover all the technologies, from artificial intelligence to life extension, to concepts we’ve yet to even dream of.



“Effective acceleration” is the move until we hit the singularity, a point in the future where technology supersedes humanity altogether and runs the show from there (we clearly need some help).



<h2 class="wp-block-heading">Securities laws are so decel&nbsp;</h2>



It’s easy to see how accels and decels would butt heads over AI. If you believe in its potential, then the stakes are extremely high.



Decels are more anti-politiks who would rather we all take a beat and mull where this big ship is headed. Less “progress for the sake of progress,” more “make progress more difficult,” even if it means fewer Silicon Valley startups.&nbsp;



Despite the fact that Karl Marx <a href="https://www.theguardian.com/world/2017/may/11/accelerationism-how-a-fringe-philosophy-predicted-the-future-we-live-in">himself</a> may have been one of the very first accels, more hardline decels would <a href="https://runway.org.au/manifesto-of-decelerationism/">argue</a> powerhouses like Amazon and Walmart have been a net negative for society. Their proliferation only enriches a reactionary class of billionaires who’ve built empires on exploitation. Best antagonize them into slowing down.



But beyond <a href="https://bitcoinmagazine.com/hyperbitcoinization">hyperbitcoinization</a>, there’s no crypto version of the singularity. It’s difficult to say what crypto-accels would strive for beyond anarcho-capitalism on the blockchain.&nbsp;&nbsp;



From crypto’s perspective, the US is the antagonizer intent on controlling its growth. The SEC has long pushed the idea that almost every cryptocurrency on the market is an unregistered <a href="https://www.cnbc.com/video/2018/11/26/sec-cracks-down-on-initial-coin-offerings.html">security</a>, even before <a href="https://blockworks.co/news/gary-gensler-regulation-sec-advice">Gary Gensler</a>.&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">Message is clear: $30m buys you about 10 months before the SEC comes around to extort you again. Lawyers can do a lot with $30m but the SEC knows that a real fight will likely cost $100m+, and valuable time. If you can&#39;t afford it, get your crypto company out of the US warzone.&mdash; Jesse Powell (@jespow) <a href="https://twitter.com/jespow/status/1726794688433369290?ref_src=twsrc%5Etfw">November 21, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div><figcaption class="wp-element-caption">Powell is clearly not a fan of crypto-deceleration</figcaption></figure>



Not to mention, the Federal Reserve continuously <a href="https://blockworks.co/news/legal-expert-avanti-may-face-uphill-battle-getting-fed-payment-access">refuses to award</a> “master accounts” to startup banks operating in the crypto space — which would grant them, among other things, easy access to the US banking system and federal deposit insurance.



A truly accel US might open all capital controls and flood the ecosystem with funding — innovation no matter what, regardless of how many investors bottom out along the way.&nbsp;



Even a sorta-accel US would agree to the “safe harbor” <a href="https://www.sec.gov/news/public-statement/peirce-statement-token-safe-harbor-proposal-2.0">proposed</a> by dissenting Commissioner Hester Peirce, which would give crypto startups three years to rapidly innovate (read: decentralize) before having to worry about US securities laws.&nbsp;



The SEC has instead sued names including <a href="https://blockworks.co/news/sec-drops-dismisses-garlinghouse-case">Ripple</a>, <a href="https://www.sec.gov/news/press-release/2019-202">Block.one</a>, <a href="https://blockworks.co/news/sec-sues-justin-sun">Justin Sun</a>, <a href="https://thenextweb.com/news/messaging-app-kik-shutsdown-kin-sec-fight-ico">Kik</a>, <a href="https://blockworks.co/news/sec-sues-coinbase">Coinbase</a> and now <a href="https://blockworks.co/news/kraken-commingle-customer-funds">Kraken</a> for alleged violations. The US is no longer a place where you can easily attempt to innovate with crypto.



<h2 class="wp-block-heading">Can’t extradite what you can’t locate&nbsp;</h2>



It wasn’t very accel of the DOJ, either, to force Binance founder Changpeng Zhao to <a href="https://blockworks.co/news/doj-indictment-binance-changpeng-zhao">step down as CEO</a> over the breaches of the Bank Secrecy Act.&nbsp;



Of course, money laundering happens in crypto — it’s valuable money. You should see how much laundering happens in <a href="https://www.europol.europa.eu/crime-areas/economic-crime/money-laundering#:~:text=The%20United%20Nations%20Office%20on,and%201.87%20trillion%20each%20year.">fiat</a> or priceless <a href="https://www.imf.org/en/Publications/fandd/issues/2019/09/the-art-of-money-laundering-and-washing-illicit-cash-mashberg">art</a>.



But so far, Bitcoin creator Satoshi Nakamoto has escaped any government attention (as far as we know, anyway).



That’s not to say that Satoshi Nakamoto wouldn’t be given the Changpeng Zhao treatment if they miraculously returned tomorrow. Ransomware is classed a national security <a href="https://partners.wsj.com/cisco/cybersecurity-simplified/ransomware-is-a-national-security-threat/">threat</a>, and almost all cases involve BTC as a medium of exchange.



If Zhao was responsible for money laundering and other sketchy activity flowing through his software, could regulators concoct a way to hold Nakamoto accountable for creating money so perfect for ransomware, even though centralized exchanges have little in common with the Bitcoin blockchain?



Probably. Dumber things have happened. Perhaps Nakamoto didn’t want to risk it — with one theory suggesting they disappeared after a <a href="https://thenextweb.com/news/satoshi-nakamoto-left-bitcoin-because-of-the-cia-theory-cryptocurrency">meeting</a> with the CIA.



<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">Today we filed an amicus brief in the 5th Circuit appeal of Van Loon v. Treasury regarding OFAC’s sanctions against Tornado Cash. Read Senior Counsel <a href="https://twitter.com/MTCoppel?ref_src=twsrc%5Etfw">@MTCoppel</a>&#39;s thread below for more. 👇<a href="https://t.co/1pmSAt1Bds">https://t.co/1pmSAt1Bds</a> <a href="https://t.co/c5ScaTDr9N">https://t.co/c5ScaTDr9N</a> <a href="https://t.co/e9ySvcKdeM">pic.twitter.com/e9ySvcKdeM</a>&mdash; Blockchain Association (@BlockchainAssn) <a href="https://twitter.com/BlockchainAssn/status/1726709704792100951?ref_src=twsrc%5Etfw">November 20, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div><figcaption class="wp-element-caption">The US has also gone after makers of crypto mixer Tornado Cash</figcaption></figure>



The most accel thing the US ever did for crypto was concede there’s nobody to sue or extradite over the creation and utility of Bitcoin. In a way, this gave BTC cover to be classed a commodity. Although, that could be just because they have no idea who Nakamoto is or their whereabouts.



The second most accel thing was allowing the CFTC to approve ether (ETH) futures, <a href="https://blockworks.co/news/bitcoin-and-ether-are-commodities-says-cftc-in-binance-lawsuit">laying the groundwork</a> for its own commodity classification. But the path to that classification remains murkier, and until that changes, Jesse Powell’s point remains.



Jesse Powell’s warning for crypto startups who can’t afford to take on a costly legal battle with a largely decel US echoes his past stance on New York’s BitLicense, which prompted Kraken to exit the Empire State entirely all those years ago:&nbsp;



“Get your crypto company out of the US warzone.”



<hr class="wp-block-separator has-alpha-channel-opacity"/>


<div class="wp-block-post-author-biography">David is an Editor based in The Netherlands focused on data-driven journalism. Previously, he wrote for TheNextWeb&#8217;s crypto vertical before launching Protos in 2021. He&#8217;s a reformed hardline Bitcoiner passionate about permissionless and decentralized networks. Contact David at david@blockworks.co</div>


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Would the US arrest Satoshi Nakamoto if they returned today?

James Cirrone

Fifteen years ago today, Satoshi Nakamoto — whose true identity remains a mystery — published their seminal white paper titled &#8220;Bitcoin: A Peer-to-Peer Electronic Cash System.&#8221;



Spanning just nine pages, this document offered up a blueprint that reimagined the way we perceive and transfer value in a digital age. It delved into the intricacies of cryptographic hashing, the architecture of blocks and the timing mechanisms that would be used to sustain them.



One of the white paper&#8217;s main innovations was its proposed proof-of-work system. While not Satoshi&#8217;s invention, its application in the context of a decentralized cryptocurrency was novel. Building upon ideas like Adam Back&#8217;s &#8220;Hashcash,&#8221; the author adapted the preexisting proof-of-work concept in order to address the double-spending problem. This ensured that every transaction on the network was verified through consensus, without relying on a central authority.



“Once the CPU effort has been expended to make it satisfy the proof-of-work, the block cannot be changed without redoing the work. As later blocks are chained after it, the work to change the block would include redoing all the blocks after it,” Nakamoto wrote in the whitepaper.



Read more: <a href="https://blockworks.co/news/proof-of-work-vs-proof-of-stake-whats-the-difference">Proof-of-work vs. proof-of-stake: Which is better?</a>



The CEO of Luxor, a firm that provides firmware for bitcoin mining machines and a hashrate derivatives trading platform, called what Nakamoto envisioned “magical.”



“The <a href="https://blockworks.co/tag/bitcoin">Bitcoin</a> blockchain is somewhat magical in that it grows stronger as time goes on…which is somewhat against the laws of the universe. As things get older, generally they degrade and break down,” Nick Hansen told Blockworks.



“I think <a href="https://blockworks.co/tag/satoshi-nakamoto">Satoshi</a> probably envisioned that,” Hansen added.&nbsp;



At present, the bitcoin blockchain has <a href="https://ycharts.com/indicators/bitcoin_blockchain_size">surpassed</a> 522 GB in size, essentially making any attempt at tampering with the distributed ledger a fool’s errand.&nbsp;



Hansen said he thinks Nakamoto likely also saw a future where <a href="https://blockworks.co/news/bitcoin-rally-mining-stocks">institutions and large companies would be the ones dominating</a> the effort to mine bitcoin, especially as the network grew larger and the computational need grew with it.&nbsp;



“Since Satoshi early on did design this to be a global payment rail, I think it would be foolish to assume that the mining portion of that ecosystem [wouldn’t] probably need to be done by massive institutional grade companies,” Hansen said. “I would say that yes, he probably figured that bitcoin mining would become a massive commodity business.”



Nakamoto drew a parallel to gold mining in the &#8220;incentive&#8221; section of the whitepaper, which detailed how bitcoins would initially circulate. Essentially, &#8220;mining&#8221; refers to the process of verifying transactions on the network.



“The steady addition of a constant of [sic] amount of new coins is analogous to gold miners expending resources to add gold to circulation. In our case, it is CPU time and electricity that is expended,” Nakamoto wrote.&nbsp;



What Nakamoto may or may not have envisioned was how bitcoin could be used to aid those suffering under the reign of dictators.&nbsp;



The Human Rights Foundation (HRF), a nonprofit championing human rights, <a href="https://blockworks.co/news/hrf-bitcoin-bounty">views bitcoin as a pivotal weapon</a> against despotism. Its decentralized nature allows those under autocratic regimes to transact outside the confines of government-controlled fiat currency.



Further championing this cause, the HRF&#8217;s Bitcoin Development Fund extends grants to innovators working to improve the bitcoin network. One notable beneficiary was the developer behind <a href="https://lnp2pbot.com/">lnp2pBot</a>, an initiative that bolsters privacy by enabling users to exchange dollars for bitcoin without the need for KYC (know your customer) identification.



The HRF’s chief strategy officer Alex Gladstein told Blockworks he’s “much more bullish” on bitcoin these days because of how much easier it is to use it since 2013, when the HRF first started working with bitcoin.



“The apps are better, they have better UX,” Gladstein said. “We have the <a href="https://blockworks.co/tag/lightning-network">Lightning Network</a>, which we didn&#8217;t have then, so we don&#8217;t have to wait around 10 minutes for confirmation and you can send bitcoin (<a href="https://blockworks.co/price/btc">BTC</a>) instantly. We have much better privacy tools than we used to have back then, which is really important for activists.”



Gladstein also noted Nakamoto’s curious choice to release the bitcoin whitepaper on Oct. 31. That was the same date Martin Luther nailed his revolutionary 95 theses to a church’s door in protest of Catholicism over 500 years ago.&nbsp;



Luther’s arguments against the church had the first whisperings of the concept of separating religion from the state, whereas the bitcoin white paper argued for the separation of money from the state, Gladstein said.



Another explanation for the publication date could be that Halloween is quite befitting for someone who later became the most famous masked anonymous figure in all of crypto.&nbsp;



Or, the specific date of Oct. 31 may not have been chosen for any particular reason other than perhaps being timed right around some of the worst declines in the traditional stock market in history.



Either way, Nakamoto’s thoughts, motives and intentions will likely be fertile ground for speculation for years to come.



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Bitcoin white paper turns 15 years old

Shalini Nagarajan

Crypto exchange Coinbase currently holds over $25 billion in bitcoin, establishing itself as the world&#8217;s largest bitcoin custody entity, with nearly 5% of all bitcoin in circulation.



Coinbase&#8217;s holdings are roughly equivalent to the stash held by Satoshi Nakamoto, the enigmatic individual or group credited with creating bitcoin and authoring the original white paper in 2008, according to Arkham Intelligence.



The identified sum was spread across 36 million deposit and holding addresses used by Coinbasein, Arkham reported in a Saturday <a href="https://twitter.com/ArkhamIntel/status/1705254948324233270">post</a> on X. The largest cold wallet identified held about 10,000 bitcoin.



<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">Arkham has now identified $25B of Coinbase Bitcoin reserves (~1M BTC) on chain. This makes Coinbase the largest Bitcoin entity in the world on Arkham, with almost 5% of all BTC in existence &#8211; about as much as Satoshi Nakamoto. <a href="https://t.co/7sDOczS7WT">pic.twitter.com/7sDOczS7WT</a>&mdash; Arkham (@ArkhamIntel) <a href="https://twitter.com/ArkhamIntel/status/1705254948324233270?ref_src=twsrc%5Etfw">September 22, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



But the blockchain analytics company suggested that the exchange probably holds thousands more bitcoins that have not been categorized yet, based on latest financial data from Coinbase. Ongoing analysis will aim to uncover these additional addresses.



Coinbase’s custody of ether (<a href="https://blockworks.co/price/eth">ETH</a>) is significantly smaller when compared to its bitcoin holdings. As per Arkham&#8217;s <a href="https://platform.arkhamintelligence.com/explorer/entity/coinbase">data</a>, the exchange held about $2.6 billion in ether.



The fact that Coinbase may hold as much bitcoin (<a href="https://blockworks.co/price/btc">BTC</a>) as <a href="http://blockworks.co/tag/satoshi-nakamoto">Nakamoto</a> is notable because it is widely believed that the mysterious bitcoin creator mined <a href="https://blockworks.co/news/on-chain-billionaires-buterin-nakamoto">an impressive amount of bitcoin</a>, with estimates ranging from 600,000 BTC (equivalent to $13 billion) to as much as 1.1 million BTC ($23.8 billion) during the cryptoasset&#8217;s early years. 



Tracking the whereabouts of all these bitcoins is considered somewhat challenging due to their dispersion across numerous addresses.



Should the upper estimate prove accurate, Nakamoto would find themselves among the top 50 billionaires globally, closely trailing Chanel chairman Alain Wertheimer.



The identity of the Bitcoin creator has remained unverified, although <a href="http://web.archive.org/web/20150405000614/http://p2pfoundation.ning.com/profile/SatoshiNakamoto">one public profile</a> which claimed association with Nakamoto indicated a location in Japan.



In Nakamoto&#8217;s writings, they <a href="https://www.reddit.com/r/btc/comments/kv6vib/the_strange_story_of_satoshi_nakamotos_spelling/">variously used</a> both American and British English spellings, as well as idiomatic expressions. This has led some to question whether the inventor&#8217;s claimed Japanese identity is accurate.



There have also been observations regarding the timestamps on Nakamoto&#8217;s comments, which have led some to speculate that they might not have been located in Japan while working on Bitcoin.



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Bitcoin held by Coinbase rivals Satoshi Nakamoto’s in size

Jack Kubinec

A newly-unearthed video shows the Bitcoin pioneer Hal Finney giving a talk on zero-knowledge proofs at the Crypto ‘98 conference.&nbsp;



<a href="https://www.reddit.com/r/Bitcoin/comments/16mzjpw/1998_hal_finney_a_zeroknowledge_proof_of/">In the video</a>, Finney talks about performing a zero-knowledge proof on a SHA-1 hash, demonstrating the existence of a cryptographically scrambled message without disclosing any details about the message. At the time of Finney’s talk, zero-knowledge proofs were known to be theoretically possible, but were generally viewed as inefficient or unfeasible.



“I wanted to find out just how inefficient or impractical they really are,” Finney says in the video before proposing a zero-knowledge proof system.



Much of Finney&#8217;s life was marked by challenging the boundaries of what was deemed possible. In 2009, the cypherpunk was the first bitcoin recipient, receiving ten bitcoin from the cryptocurrency’s pseudonymous founder Satoshi Nakamoto. The same year, Finney was diagnosed with ALS. Just shortly after, he <a href="https://www.lesswrong.com/posts/bshZiaLefDejvPKuS/dying-outside">wrote</a> in a blog post: “[M]y dream is to contribute to open source software projects even from within an immobile body. That will be a life very much worth living.” Finney died in 2014 and is cryopreserved in Arizona.



The subject of Finney’s 25-year old <a href="https://twitter.com/pete_rizzo_/status/1704522067582894293">talk</a> remains vexing today. <a href="https://blockworks.co/tag/ethereum">Ethereum</a> layer-2s are locked in an arms race building zero-knowledge proofs to scale the ecosystem. However, the efficacy of this technology <a href="https://blockworks.co/news/a16z-zkrollup-proof-system">is yet to be established</a>. Implementing zero-knowledge proofs can be prohibitively costly or compromise security, rendering them inefficient and impractical.



In Finney-ian fashion, though, crypto developers are still chipping away at a solution.



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25-year old video shows Bitcoin pioneer Hal Finney talking zero-knowledge proofs

Public blockchains have revolutionized how we view money. But they’ve also unlocked a brand-new form of financial voyeurism.



Instead of poring over SEC filings or Forbes lists, the crypto-curious can now ogle billionaires for kicks entirely on-chain.



Luckily, there’s no shortage of crypto billionaires. But most are practically anonymous, known only by their pseudonymous blockchain addresses.



There are, however, a select few crypto moguls who lay bare their portfolios for all to see, warts and all.



<h2 class="wp-block-heading">Ethereum co-founder Vitalik Buterin</h2>



Buterin was <a href="https://www.forbes.com/sites/ninabambysheva/2021/05/03/ethereums-27-year-old-co-creator-is-now-the-worlds-youngest-crypto-billionaire/?sh=6ff2ddeb7c94">crowned</a> the world’s youngest crypto billionaire by Forbes in 2021 — when ether (<a href="https://blockworks.co/price/eth">ETH</a>) cleared $3,000 for the first time. On-chain data can’t verify the ‘youngest crypto billionaire’ moniker, but it does seem to corroborate those numbers.&nbsp;



Buterin’s known crypto portfolio was valued at about $2 billion in May 2021, per Arkham Intelligence. ETH understandably made up about half of those holdings. But Buterin has been worth far more than that, in the throes of <a href="https://blockworks.co/news/bonk-solanas-own-dog-coin-sparks-joy-for-weathered-community">dog coin</a> mania.



Plucky dog coin fans and issuers have historically flooded Buterin’s Ethereum addresses with immense amounts of illiquid tokens. It’s a form of guerilla marketing — aiming to trick chain watchers into believing Buterin was deep in their useless memecoins.



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Vitalik Buterin was a prime target for dog coin marketers during the last bull run



And so, on May 12, 2021, Buterin’s crypto portfolio was worth more than $20.5 billion – which would have put him on par with the likes of Bridgewater’s Ray Dalio and Google’s Eric Schmidt.&nbsp;



Shiba Inu (<a href="https://blockworks.co/price/shib">SHIB</a>) made up $17.8 billion of those funds (87%), but there were myriad other dog coins including AKITA and HUSKY. The subsequent (and arguably inevitable) SHIB crash tanked their value considerably, and Buterin <a href="https://twitter.com/sandeepnailwal/status/1392562768692252673">donated</a> whatever was left to India’s Covid relief fund.



Buterin now holds about $484 million in crypto in his known addresses — practically all of it ETH. Arkham Intelligence indicates Buterin has sent $74 million in on-chain assets to crypto exchanges over the years, including Coinbase and Kraken.



<h2 class="wp-block-heading">Ripple co-founder Jed McCaleb</h2>



McCaleb’s crypto billions were dished out over nearly a whole decade.&nbsp;



Until last year, Ripple Labs had sent a steady stream of <a href="https://blockworks.co/price/xrp">XRP</a> to McCaleb’s infamous “<a href="https://bithomp.com/explorer/rEhKZcz5Ndjm9BzZmmKrtvhXPnSWByssDv">tacostand</a>” address, and he subsequently sold it on public markets.



Ripple initially had <a href="https://www.coindesk.com/markets/2014/08/14/jed-mccaleb-ripple-labs-strike-deal-to-avoid-9-billion-xrp-sell-off/">concerns</a> over how quickly McCaleb sought to dump his founder’s reward, which amounted to 9 billion XRP in total (worth $54 million when the case was settled, $4.2 billion today).&nbsp;



The settlement saw strict rules on how much XRP McCaleb would receive per year, starting with $10,000 every week in 2015 to 2 billion XRP ($844 million) each year after 2020.



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1538" height="948" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=1024&amp;h=1024" alt="" class="wp-image-53224" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=1538 1538w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=417 417w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=423 423w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=355 355w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/image-3.png?w=80 80w" sizes="(max-width: 1538px) 100vw, 1538px" /></figure>



Jed McCaleb’s XRP sales peaked in 2021 (source: <a href="https://whale-alert.medium.com/chasing-crypto-whales-9a3578617a54">Whale Alert</a>)



McCaleb’s ‘tacostand’ now holds zero XRP, having received the last tranche of payouts in mid-2022.



Chain watcher Whale Alert estimated McCaleb had sold 5.7 billion XRP over eight years, raking in $3.1 billion. The firm found that McCaleb sold XRP for an average price of $0.55 per token, or about 19% above its current price.&nbsp;



Forbes today estimates McCaleb’s net worth at $2.4 billion, having gone on to found rival blockchain network Stellar.



<h2 class="wp-block-heading">TRON founder Justin Sun</h2>



His (<a href="https://markets.businessinsider.com/news/currencies/grenada-takes-a-stand--tron-blockchain-founder-justin-sun-loses-wto-rep-role-amid-sec-lawsuit-12317470">former</a>) Excellency held $6.3 billion in crypto at his portfolio’s peak in Sept. 2021.&nbsp;



That figure would’ve placed Sun in the top 500 richest billionaires in the world, in line with Lululemon founder Chip Wilson and Viking Global’s Andreas Halvorsen.



Sun has a reputation for degeneracy, and his portfolio at all-time high is supporting evidence.&nbsp;



About 95% of his portfolio was locked inside lending protocols Aave and Curve, earning yield, as markets closed in on their record highs — including 2.63 billion <a href="https://blockworks.co/price/usdc">USDC</a>, 478250 WETH ($1.86 billion) and 11,000 <a href="https://blockworks.co/price/btc">BTC</a> ($545 million).



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</div></figure>



Justin Sun stakes his ETH with Lido



<ul>
<li>Today, Sun’s known crypto portfolio is worth $858 million.&nbsp;</li>



<li>303,660 Lido staked eth (<a href="https://blockworks.co/price/steth">STETH</a>) makes up $580 million, followed by $160 million in Sun’s stablecoin USDD.&nbsp;</li>



<li>He also holds 23,724 ETH ($46.76 million) and 6,802 <a href="https://blockworks.co/price/mkr">MKR</a> ($4.97 million)</li>
</ul>



Sun is indeed a prolific trader. The data indicates he’s sent $22.6 billion in crypto to exchanges over the years, more than half of it going to Binance.



<h2 class="wp-block-heading">Satoshi Nakamoto and other anons</h2>



Bitcoin’s mysteriously absent creator is believed to have mined anywhere from <a href="https://blog.bitmex.com/satoshis-1-million-bitcoin/">600,000</a> BTC ($16.75 billion) to <a href="https://bitslog.com/2013/04/17/the-well-deserved-fortune-of-satoshi-nakamoto/">1.1 million</a> BTC ($30.7 billion) throughout the early years.



All those bitcoins are believed to have been spread out across hundreds of addresses, so tracking those funds directly is somewhat difficult.&nbsp;



If the higher estimate is true, Nakamoto would place in the top-50 billionaires in the world, just shy of Chanel chairman Alain Wertheimer.



The notorious “1Feex” address is another notable on-chain billionaire. Since Mar. 2011, the address has held close to 80,000 BTC ($2.25 billion) once controlled by Ross Ulbricht’s Silk Road marketplace.&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"><a href="https://t.co/mkmVORIfxD">pic.twitter.com/mkmVORIfxD</a>&mdash; Danny Brewster (@BtcDanny) <a href="https://twitter.com/BtcDanny/status/1364729604863389696?ref_src=twsrc%5Etfw">February 25, 2021</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Craig Wright claims to own the address tied to the Silk Road hack



It’s believed someone connected to the monumental heist has access to ‘1Feex,’ although claiming the BTC would no doubt bring a certain amount of unwanted heat.&nbsp;



That didn’t stop self-proclaimed Bitcoin creator Craig Wright from (unsuccessfully) claiming ownership of the funds during one of his court cases last year.



Just under a <a href="https://bitinfocharts.com/top-100-richest-bitcoin-addresses.html">dozen</a> Bitcoin addresses not associated with crypto exchanges or other entities contain $1 billion or more. Curiously, no unattributed Ethereum addresses contain $1 billion or more ETH right now, according to <a href="https://etherscan.io/accounts">Etherscan</a>.



<h2 class="wp-block-heading">Coinbase CEO and other off-chain billionaires</h2>



Crypto billionaires with a majority of their wealth off-chain deserve a special mention.&nbsp;



<a href="https://blockworks.co/news/coinbase-ceo-armstrong-stock-sales-life-extension">Brian Armstrong</a>, Coinbase co-founder and CEO, currently holds about $590,000 in his known addresses, Arkham Intelligence data shows, almost all of it ETH.



Armstrong’s portfolio was worth $1.23 million at its peak in early February, comprised practically entirely of <a href="https://blockworks.co/price/dydx">DYDX</a>, the native token for the decentralized exchange of the same name. Forbes puts Armstrong’s current net worth at $2.5 billion.



Dallas Mavericks owner and prolific crypto backer <a href="https://blockworks.co/news/mark-cuban-to-be-deposed-next-month-in-voyager-ponzi-suit">Mark Cuban</a> boasts about $4 million. USDC makes up more than half, followed by STETH and wrapped ETH.&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">Mark Cuban (<a href="https://twitter.com/mcuban?ref_src=twsrc%5Etfw">@mcuban</a>) makes a case for why the American government needs to embrace crypto over than gold, which he calls “useless”. <a href="https://t.co/bdjbhxgdxd">pic.twitter.com/bdjbhxgdxd</a>&mdash; Bankless (@BanklessHQ) <a href="https://twitter.com/BanklessHQ/status/1366224417546792963?ref_src=twsrc%5Etfw">March 1, 2021</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Mark Cuban has been making the case for crypto for years



At all-time highs last August, Cuban held $7.16 million, but 86% of it was USDC locked inside Aave. ETH, ApeCoin (<a href="https://blockworks.co/price/ape">APE</a>), <a href="https://blockworks.co/price/ens">ENS</a> and Rarible (<a href="https://blockworks.co/price/rari">RARI</a>) made up the remainder, among others. Forbes estimates Cuban’s entire net worth at $5.1 billion.



Of course, there are plenty of other crypto billionaires out there, and the featured names may very well have unknown crypto holdings.&nbsp;



Still, it’s clear that some prominent figures put their crypto where their mouth is.



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On-chain Billionaires: Tracking Crypto Portfolios from Buterin to Nakamoto

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>.



<h2 class="wp-block-heading">Bitcoin boomed with Big Tech</h2>



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.



<h2 class="wp-block-heading">Proof instead of trust</h2>



“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>



<h2 class="wp-block-heading">Bitcoin after the Merge</h2>



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 class="wp-block-heading">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 class="wp-block-heading">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 class="wp-block-heading">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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