The credibility of Craig Wright’s claim to be Bitcoin creator Satoshi Nakamoto took another hit on May 25, when he was called a liar in a message signed by 145 of the 16,404 Bitcoin block’s addresses he told a court in January he had mined.
Those bitcoin addresses are part of the 1.1 million bitcoins thought to have been mined—and left untouched—by the pseudonymous Nakamoto in 2009-2010, the early years of the Bitcoin blockchain. That list, known as the “CSW Filed List” in court, only accounts for 820,200 BTC, or approximately $7.75 billion.
Now attorneys representing the estate of Wright’s late partner, Dave Kleiman, are touting that anonymous message as more proof that Wright is hiding the Satoshi’s $10 billion bitcoin cache from the court.
“Plaintiffs’ file this supplement to notify the Court of new evidence that further proves the ‘CSW Filed List’ is not a list of Wright’s bitcoin public addresses,” Kleiman’s attorneys wrote. Instead, they added, it “is instead a purposeful fabrication by him.”
Judge Beth Bloom of the District Court for the Southern District of Florida has already called Wright a liar and found that he has submitted forged evidence.
Of course, the vast majority of the cryptocurrency community sees the message as yet more proof that Wright is lying about being Nakamoto, and doesn’t have access to the 1.1 million bitcoins thought to have been mined by the first cryptocurrency’s pseudonymous creator.
The message, available here, reads: “Craig Steven Wright is a liar and a fraud. He doesn’t have the keys used to sign this message… We are all Satoshi.” It is signed by the massive wall of text that is 145 Bitcoin addresses and private keys.
The anonymous accusation
The message came as the result of a leak of sealed information in the lawsuit by Ira Kleiman’s attorneys, Roche Cyrulnik Freedman.
Wright had provided the court with the list of 16,404 bitcoin addresses whose private encryption keys he claims are locked in a trust. On May 21, Kleiman’s attorneys “accidentally” released that list in a filing posted on the federal court’s Pacer public information site for less than 45 minutes, Velvel Freedman told the court. During that time it was picked up by the non-profit CourtListener.com website, where it remains available.
After news of the BTC-signed message was posted on Reddit’s BSV forum, Zectro, a moderator of the subreddit, began checking those addresses against the list Wright provided the court.
“I checked the first few addresses and verified that they were both on the Tulip Trust, and that the signatures for them are valid,” Zectro said in a post. “This checks out. Craig’s fucked.”
He reposted his findings on his Twitter account, @Zectro1, without the obscenity.
The expert witness
In order to verify the message signed by those 145 Bitcoin addresses, Kleiman’s attorneys enlisted Bitcoin author and evangelist Andreas Antonopoulos as an expert witness.
Antonopoulos told the court that he “analyzed the message, bitcoin addresses, and digital signatures; I then compared the 145 bitcoin addresses on Exhibit A to the CSW Filed List.”
He found that the 145 bitcoin addresses were on the list Wright gave to the court.
“All 145 signatures on Exhibit A were valid digital signatures that had signed the message… by using the private key corresponding to the respective bitcoin address (the only way to generate such a signature),” said Antonopoulos. “This means that whoever produced the digital signatures in Exhibit A unequivocally possessed the private keys to all 145 bitcoin addresses that appear on both Exhibit A and the CSW Filed List.”
Antonopoulos said that the 7,250 bitcoins controlled by the 145 addresses “were created in 2009 and early 2010 and had not been used to transact or, to my knowledge, sign messages prior to May 24, 2020.” (At that time, each new Bitcoin block mined 50 BTC.)
Noting that producing 145 signatures on a message “required significant manual effort, or the application of a custom program,” Antonopoulos said that “whoever signed this message appears to have undertaken significant work to make their point.”
He concluded, “whoever constructed these signatures expended non-trivial effort and used keys that had not been used for 10 years to cryptographically prove they had possession of keys the Defendant claimed to own.”
Those 7,250 bitcoins were worth about $64.7 million on May 25, Antonopoulos said in his affidavit. At the time of publication—4:30 p.m. EST on May 29—they were worth about $68.1 million.
No Satoshi message
However, anyone hoping that the “Craig Steven Wright is a liar and a fraud” message came from the real Nakamoto is likely to be disappointed, according to a May 25 Twitter thread by BitMEX Research.
In response to questions, the cryptocurrency exchange and derivative trading platform’s research arm said it looked back at a study it published in 2018, investigating whether Nakamoto really mined more than one million bitcoins, as was generally believed. That study found that one “dominant miner”—presumably Bitcoin’s creator—actually mined more like 700,000 BTC in 2009, the year the Bitcoin blockchain went live.
After reviewing the 145 bitcoin addresses, BitMEX research said “143 were not allocated to the dominant miner.” The remaining two were in the “weak allocation” category, meaning they “are likely to be wrongly allocated” to the “dominant miner,” BitMEX added.
The end run
The May 27 filing came in the form of a supplement to an earlier motion for sanctions, which summarized the ways in which Kleiman’s attorneys—and the two judges hearing the case—believe Wright has lied under oath and submitted forged evidence.
That original 26-page motion, filed on May 21, said that since “the inception of this case, Wright has engaged in a sustained pattern of perjury, forged evidence, misleading filings, and obstruction—this included submission of false evidence which, if not unmasked, could have resulted in Plaintiffs being deprived of their day in court.”
It specifically called out Wright for submitting “a forged list of his bitcoin”—among many other infractions.
Noting that the Kleiman estate has “spent millions of dollars in attorney’s fees and costs trying to chase down and unpack all of Wright’s misconduct,” the sanctions motion claimed that it was “a sad, but inescapable, conclusion that Wright has determined his cheating is worth it as he continues to this day to make a mockery of the process.”
It added, “Wright must be made to understand that perjury, forgery, and purposeful obfuscation are not ‘efficient’ breaches.”
Specifically, Kleiman’s attorneys want Judge Bloom to issue a default judgement granting them half of the bitcoins they believe Wright and Dave Kleiman mined as Satoshi Nakamoto, as well as half of the bitcoin intellectual property. That would avoid a costly trial in a case that has already dragged on for more than two very expensive years.
The Ah-ha! moment
The initial sanctions motion argues that Wright “has the ability” to open the encrypted file of bitcoin private keys allegedly held in the various Tulip Trust documents. But, it claimed, he “won’t because it will contain evidence of the partnership and its bitcoin holdings.”
It cites two pieces of evidence to back that up. The first is that $1.6 million worth of the allegedly locked bitcoin contained in four addresses on the list was spent between July 2019 and as recently as May 13.
Noting that “it would be impossible to spend these bitcoin without access to the private keys Wright has testified unequivocally he still does not have access to,” the initial Kleiman sanctions motion called this “incontrovertible evidence” that the CSW Filed List of bitcoin addresses is fraudulent or incomplete.
The only other alternative, the Kleiman filing said, was that Wright “does have access to a list of his bitcoin and the private keys associated with them and is lying about and hiding that information to prevent Plaintiffs from using the list to prove a partnership, the amount of bitcoin at issue, and to eventually trace those assets.”
The second piece of evidence Kleiman’s attorneys said proved that Wright has access to the Satoshi billions came in the form of a comment Wright made to Brendan Sullivan in an exclusive interview published in Modern Consensus on Aug. 26, 2019.
Specifically, Wright claimed he could have “tanked the market anytime in the last 10 years and ran away laughing.” By which he meant that spilling hundreds of thousands of bitcoins on the market would have driven the price through the floor.
In that article, Wright spoke to Brendan Sullivan moments after Federal Magistrate Judge Bruce Reinhart—who was overseeing discovery in the case—ruled that Wright’s lies and misconduct were so egregious that he must turn over half of the 1.1 million Nakamoto bitcoins to Kleiman immediately. (That ruling was later overturned by the presiding judge, Beth Bloom.)
Taking Wright at his word, despite all evidence they presented arguing that this is unwise, Kleiman’s legal team concludes “Wright’s refusal to open the encrypted file strongly suggests he knows that its contents will include partnership records, support the existence of a partnership between Wright and Dave Kleiman, and that the 820,200 bitcoin on the CSW Filed List… belong to the partnership.”
The Uh-oh! Moment
All of that conveniently ignores a third possibility: that the many, many people in the cryptocurrency industry who believe Wright is lying about being Nakamoto and does not have access to any of the Nakamoto bitcoins are right.
Of course, that would mean Ira Kleiman “spent millions of dollars in attorney’s fees and costs” on a wild goose chase.
Which is more or less the conclusion prominent crypto attorney and Wright denier Stephen Palley, a partner at Anderson Kill, came to when the “Craig Steven Wright is a liar and a fraud” message came to light.
Referring to Wright, Palley tweeted: “Hard to see how his lawyers stay on in the case if this is true. Also hard not to see how he doesn’t get defaulted, held in contempt and (potentially) referred for a perjury prosecution.”
As for the Kleiman filing in response to the the “Craig Steven Wright is a liar and a fraud” message, Palley’s Twitter reaction was succinct: “game over.”