Bitcoin tokens seen in Sandy, Utah. (AP PHOTO/RICK BOWMER)
He founded the crypto-currency that took the world by storm. And not even his parents knew.
A 64-year-old Japanese-American man named Satoshi Nakamoto is the real brains behind the bitcoin, a digital currency that has no physical form and lacks any ties to a country. Bitcoin is also wildly successful, as far as currencies going, with everyone from football teams to food shops announcing plans to accept the digital currency.
But where did it come from? Widely circulated stories said it was a genius kid in Tokyo that came up with the concept. Not so, writes Leah McGrath Goodman in a cover story for the recently relaunched Newsweek magazine.
‘I am no longer involved in that and I cannot discuss it. It’s been turned over to other people.’
– Satoshi Nakamoto
“Far from leading to a Tokyo-based whiz kid using the name ‘Satoshi Nakamoto’ as a cipher or pseudonym (a story repeated by everyone from Bitcoin’s rabid fans to The New Yorker), the trail followed by Newsweek led to a 64-year-old Japanese-American man whose name really is Satoshi Nakamoto. He is someone with a penchant for collecting model trains and a career shrouded in secrecy, having done classified work for major corporations and the U.S. military,” Goodman wrote. (See a picture of Nakamoto at Newsweek.com.)
Nakamoto lives in the foothills of Los Angeles, did not share with much of his family his connection to bitcoins, and was decidedly displeased to have his anonymity violated — going so far as to call the cops on Goodman when she showed up at his door.
“I am no longer involved in that and I cannot discuss it,” he said. “It’s been turned over to other people. They are in charge of it now. I no longer have any connection.”
Nakamoto graduated from California State Polytechnic University in Pomona, Calif., with a degree in physics, but Newsweek found him through his interest in model trains — which he upgrades and modifies through computer-aided design (CAD). He lives in a “modest, single-family home in Southern California” and drives a silver Toyota Corolla CE, Goodman wrote — and is worth an estimated $400 million.
In bitcoins. Of course.
That wealth may not last long. Mt. Gox, a Japanese company that is the world’s largest exchange of bitcoins, filed for bankruptcy protection at the end of February, announcing a massive theft of several hundred million dollars worth of the digital currency.
The bitcoin market had been tumultuous before that, with massive fluctuations in price driving exchange rates up and down by tens or even hundreds of dollars per day. The stress of the industry may be one reason 28-year-old Autumn Ratke, CEO of U.S.-based bitcoin exchange First Meta, committed suicide recently.
The explosion in popularity of the coin made early investors like Nakamoto instantly wealthy. Goodman interviewed Bitcoin’s chief scientist, the 47-year-old Gavin Andresen. Another early investor, he has done well by bitcoins.
“I made a small investment in bitcoin and it is actually enough that I could now retire if I wanted to,” Andresen told Newsweek. “Overall, I’ve made about $800 per penny I’ve invested. It’s insane.”
Nakamoto, the inventor of bitcoin, has been reluctant to spend his fortune, Goodman wrote — money his family could use. The reason might be simple: He does not want to participate in the Bitcoin madness, she noted.
“If you come out as the leader of Bitcoin, now you have to make appearances and presentations and comments to the press and that didn’t really fit with Satoshi’s personality,” Andresen told Newsweek.