Why Bitcoin SV Probably Isn’t the “Real” Bitcoin – Part I
In this article, we review the story of Australian entrepreneur Craig Wright and how BTC’s latest competitor, Bitcoin SV came to be. By now you may be aware of the controversy surrounding Wright and BSV, as both subjects seem to make the crypto news quite a bit these days. However, the connection between BSV’s price performance and the Wright controversy is not often explored in depth. Across a series of 2 articles, we intend to do exactly that, and explain why BSV probably won’t be replacing BTC any time soon.
Why Bitcoin SV Probably Isn’t the “Real” Bitcoin – Part I
In previous articles, we’ve covered such subjects as the creation of Bitcoin Cash, its mission to overthrow BTC as the “real bitcoin,” and the “Bitcoin Cash Civil War,” which ultimately led to the creation of Bitcoin SV – yet another competitor seeking the title Bitcoin Cash was after. Bitcoin SV (BSV) was born out of contention; chiefly as a reaction against changes being made to the Bitcoin Cash (BCH) protocol that not everybody in the BCH community agreed with. The most vocal leader of the opposition was the highly controversial Craig Wright, who saw BCH as going in a direction that strayed too far from its roots in serving as a “digital cash.”
Wright, who is widely known for attempting to convince the world that he was Satoshi Nakamoto in 2015 and 2016, vowed a “hash war” with the de facto leader of Bitcoin Cash, Roger Ver, if the core software of BCH (known as Bitcoin Cash ABC) was updated to include features Wright saw as extraneous. In the war, Wright said, he would “see both coins trade at zero,” confident that more miner power would end up supporting his version of Bitcoin Cash (later to known as Bitcoin SV), and as such, his version would retain the Bitcoin Cash title and trading symbol.
The scheduled ABC upgrade (hard fork) took place on November 15th, 2018, a date on which Bitcoin Cash split into 2 forks: BCH ABC and BCH SV. After a month of heavy warring (during which the price of BTC and most other coins fell dramatically), it became apparent that BCH ABC was going to be the victor, having mined a significantly higher number of blocks than SV, and with a higher hash rate as well. In the chart below, which tracks the average hash rate of Bitcoin (BTC – orange line), Bitcoin Cash (BCH – green line) and Bitcoin SV (BSV – red line), it can be seen that BSV put up a good fight until about December 18th, after which BCH decisively pulled ahead, where it currently remains.
What happened in the aftermath was the birth of a new bitcoin competitor: Bitcoin SV. Initially, BSV was ill-prepared to stand on its own: it lacked a proper wallet client, a decent selection of mining pools, partnerships in the industry, as well as some basic features, like its own logo. This was mainly because Wright had intended to win the hash war and take the reins of Bitcoin Cash leadership from Roger Ver, but instead found himself with a nice consolation prize, which was the (then) 11th biggest coin by market cap (BSV has since moved up to 9th place).
As the dust settled, the rest of the crypto market soon began to recover, but the fight for legitimacy was really just beginning for Wright and Bitcoin SV. Now, BSV would have to prove to the world that it could be just as good a bitcoin competitor – or even better than – BCH. Some of BSV’s advantages touted by their supporters include:
- a greater capacity for scaling (128 MB blocks instead of BCH’s 32 MB blocks, with plans to increase the block size to 2 GB before the end of July)
- a “cleaner” source code that excludes features added by Bitcoin Cash and is more representative of the original Bitcoin protocol, as planned by Satoshi in his white paper and implemented in the pre-SegWit versions of Bitcoin Core
- cheaper transaction fees (with an average fee of less than one penny, as compared to BTC’s fee $1-$4, or more).
Arguably, Bitcoin SV’s biggest selling point, and the reason why it has managed to attract so much attention after the hash wars, is Craig Wright’s (repeated) claims that he is Satoshi Nakamoto. On more than one occasion, he has professed as much, and along with that comes the claim that he has written the famous Bitcoin white paper, which Bitcoin SV uses as its own official white paper. An example such an occasion can be found in a Medium article published by Wright in April, when he made the following statement in response to his critics:
“You’re about to find out why I created bitcoin and yes I am Satoshi Nakamoto. I created it to stop all of the global scams. I created bitcoin to start to bring order into the norm. Thank you for helping it grow and in your ignorance giving me everything I need to stop you.” – Craig Wright
Since April, the story has taken some amazing twists and turns, as Wright has waged an immense battle for legitimacy. This includes filing a flurry of patents via his company, nChain, pursuing defamation lawsuits against popular Twitter personalities (including Ethereum developer Vitalik Buterin), going on a worldwide tour to espouse the benefits of BSV, and also engaging the media to get his story out to the masses as frequently as possible.
However, Wright’s past is heavily checkered with inconsistencies, having been accused of lies, forgeries and even charges of plagiarism. Though the body of evidence is simply too vast and too controversial to contain in a single article, it is likely the case that Wright is not Satoshi Nakamoto, for a number of reasons. This issue had been discussed at length in a previous Coin Clarity article, and for the sake of brevity only evidence that has occurred post-BSV fork is being included here, discussed point-by-point.
Why it Matters for BSV that Wright is Satoshi, and Why He’s Probably Not
Regardless of who the leader of Bitcoin SV is, should that title really matter for the success of any cryptocurrency? If a coin featured stunning technological breakthroughs, which made it largely self-evident that it was leaps beyond anything else currently present, and that rendered its usefulness to society clearly visible, perhaps not. However, if a coin is more-or-less a copy of a previously-existing technology (as BSV is to BTC), then clearly it is going to require some excellent marketing in order to distinguish itself. Wright’s claim that he is Satoshi is thus the perfect marketing gimmick necessary to make it stand out from the crowd of other coins. It goes one step beyond Bitcoin Cash’s ploy to be recognized as the “real bitcoin” by claiming that its leader was the inventor of not only Bitcoin but blockchain technology itself.
How can it be visualized that Wright’s claims are indeed having an effect on the market value of BSV? One clear example is when a recent press release containing incorrect information that Wright had been granted copyrights for the original Bitcoin white paper and version 0.1 of the cryptocurrency’s code, the price of BSV more than doubled immediately afterward. Even though the story was inaccurately reported in that Wright was only granted copyright registration and not the actual copyright itself, it was enough to make the crypto market go berserk for BSV. Ergo, it can be rationalized that a sizeable portion of BSV’s market cap value is propelled by the idea than Wright is indeed Satoshi.
As he is the chief scientist of Bitcoin SV’s lead development team, which is heavily invested in BSV, Wright also has obvious financial motives for proving to the world that he is Satoshi Nakamoto. However, all of the major pieces of evidence he has provided of such thus far have been demonstrated to be inconsequential or forged. For example, one of Wright’s most famous deceptions is when he edited a 2008 blog entry in 2015 to make it seem as if he had invented the word “cryptocurrency” and suggested that he was releasing the Bitcoin white paper:
In addition, an op-ed published on the website bitcoinmagazine.com entitled “How Many Wrongs Make a Wright?”, cypherpunk/coder Jameson Lopp presents an immense gathering of referenced claims made by Wright that were investigated and found to be inaccurate; among them is evidence that Wright did not possess the technical knowledge of bitcoin’s inner workings that Satoshi did. However, what the list compiled by Lopp demonstrates most noticeably is that Wright has a tendency to not tell the truth when it came to Satoshi-related matters.
One of the most clear-cut examples given by Lopp points to a February 2019 tweet, in which Wright claims to have sent a copy of an original publication entitled “Project BlackNet” to the Australian government in 2001, which was a full 7 years before the release of the Bitcoin white paper. However, when Wright’s document was compared to a draft version of the bitcoin white paper (originally posted on the cypherpunks mailing list in August 2018), it was found that he had included minor changes made between drafts of Satoshi’s white paper. This detail potentially indicates that Wright had no previous knowledge of the August 2018 draft.
More recently, Wright has been in court where he is a defendant in a civil suit that claims he is in possession of at least some of Satoshi’s tremendous stash of mined bitcoins, which the suit alleges he mined with a former (and now deceased business partner). Ironically, the plaintiff’s success is more-or-less dependent on Wright actually being Satoshi. Wright’s June 28th court appearance produced a lot of testimony and pieces of evidence which have been dissected by law experts around the globe over the last couple of weeks. There is so much content to go over that it is going to take a follow-up article to thoroughly review. In the meantime, we leave you with this 2016 video clip of Vitalik Buterin explaining why he thinks Craig Wright is probably not Satoshi Nakamoto. It is a simple yet strikingly elegant rationale, and Wright’s recent actions also conform to the context of this same theory, put forth 3 years ago by Buterin.