Craig Wright word worthless
Alt coins,  Bitcoin,  Opinion,  People

EXCLUSIVE: The Case Against Craig Wright, Part II (2012 to present)

A #Faketoshi hobbyist walks us through more of the details behind accusations that Craig Wright lied and forged proofs that he is Bitcoin creator Satoshi Nakamoto

In this interview series we page through all the documents that make the case against Craig Wright, who claims to be Satoshi Nakamoto, the pseudonym chosen by the author or authors of the Bitcoin whitepaper.

In Part I, we discussed how a document from 2011 had a font from 2015, Wright’s early inability to spell “Bitcoin” correctly, and problems with the timeline of the network of nearly 70 computers he claimed mined bitcoins right at the start We left off in 2011, two years after the bitcoin protocol went live. At that point, according to our source, Wright didn’t own any bitcoin yet.

The best way to start is by checking out “The Case against Craig Wright, Part I.” 

In Part II, we pick up in 2012—although the action really begins in April 2013, when Craig Wright bought some bitcoins on the doomed Mt. Gox cryptocurrency exchange..

Craig Wright: Genius or liar?

Case against Craig Wright
Arthur van Pelt is not a fan of Craig Wright (Photo: Arthur van Pelt)

Ever since nChain Chief Scientist Craig Wright first claimed to be the man behind the pseudonym Satoshi Nakamoto in a 2015 joint interview with Wired and Gizmodo, he has met with skeptics. 

After “doxxing” Wright in 2015 with an explosive story, WIRED quietly retracted their story. The added, “This piece has been updated to clarify Wright’s claims, and the headline has been changed to make clear that WIRED no longer believes Wright is likely to be the creator of Bitcoin.”

Many other outlets soon found inconsistencies in Wright’s story. Was he lying? Or do things not add up because Wright never wanted to be connected to the name Satoshi Nakamoto? 

[Editor’s Note: “Skeptics” is putting it mildly. The vast majority of the cryptocurrency community thinks Craig Wright is lying when he claims to have invented Bitcoin, and many have reacted with rage to the Australian’s claims. The same applies to Wright’s Bitcoin hard fork Bitcoin SV (BSV), which he calls the only “real” Bitcoin true to Nakamoto’s (that is, his own) vision. It is the sixth-largest cryptocurrency by market capitalization, but sees minimal trading volume. 

That said, when people call Wright a liar, they generally refer to loads of proof without going into detail, which is considered a problem by Brandon, and journalism types generally. So he decided to dive into what proved to be a very deep pool.]

The Case Against Craig Wright

Every time we post a new story about Wright my Twitter mentions turn into a steaming pile of garbage. I’m either a shill for BSV—the cryptocurrency connected most to nChain—and trying to pump up a fake coin or I’ve betrayed the cause by holding crypto people up to the tiniest of standards. 

What really drives me nuts is that most of these people are very disorganized. Some say a 2015 timestamp on a document from 2011 is proof of fraud. (Wright’s lawyers blamed OCR software that scanned the document). Many use this to discredit the authenticity of his estimated 600 patents.

So instead of pretending that I know everything, I’m going to use my journalism skills to interview the most organized Twitter troll I can find. For that we look to Arthur van Pelt, a “self-employed Bitcoin entrepreneur, living in The Netherlands.” A Bitcoin software builder, van Pelt said that his company, Cryptoboost, is raising funds to buy European banks and convert them to run on crypto. So Wright’s BSV is, theoretically, a threat to the health of his product.

Modern Consensus spoke to Arthur over the course of several days to hear his story and fact check his facts. 

Is there any basis to this Craig-denier’s claim? We’ll leave that up to you to decide.

[Editor’s Note: Wright attorney Andres Rivero, who represents Wright in the $10 billion Kleiman Estate lawsuit told Modern Consensus, “This individual doesn’t have any basis for what he’s saying and it has no bearing on our case.” 

That suit pits Wright against Ira Kleiman, the adopted brother of Wright’s late partner, Dave Kleiman, who died in 2013. Kleiman is demanding half of the 1.1 million bitcoins mined shortly after the first cryptocurrency’s genesis block by the real Nakamoto, as well as half the Bitcoin intellectual property. While Kleiman’s attorneys are doing quite well in court, they are having some trouble getting Wright to prove that he can actually access that fortune.]

Why I fight

Brendan Sullivan: How’s it going, Arthur?

Arthur van Pelt: Given the circumstances, not too bad. You? 

Ready for Round 2?

Yeah!

It’s honestly amazing how on top of this you are. Sometimes you get documents in Craig’s biggest lawsuit before I do. And I’m the guy reporting on the case.

On a more serious note, what drives me most to do this fraud research is anger. Paying $5,000 to dox someone is ugly behavior in my book. 

My big question is, though, if Craig made up all this just to pretend to be Satoshi Nakamoto: How can Craig be so certain that the real Satoshi Nakamoto won’t appear? How can he be certain that he won’t be found out and that the 1.1 mil bitcoins in the “Satoshi blocks” will never move?

I’ll get into that later. First let’s continue where we ended last time. After Craig Wright learned about Bitcoin in July 2011, he kept quiet about the subject until April 2013, an extremely significant month in Craig’s life when it comes to Bitcoin. 

April 2013

So when did he get Bitcoin according to you?

Craig Wright touched the first actual bitcoins of his life on Mt. Gox [cryptocurrency exchange] in April 2013. For his first trades, Craig deposited AUD 5,000. 

That’s only about $3,168 US.

The max value in his Mt. Gox account was about AUD 20,000 in Nov. 2013. Finally, Craig lost less than 15 BTC in the early 2014 Mt. Gox crash, valued at  about $8,300 at the time.

View image on TwitterCase Against Craig Wright

And just to be clear: this data is all coming from tax documents? Business reports?

No. The Mt Gox data is extracted directly from the Mt Gox database. After Mt Gox collapsed early 2014, its database was leaked, and Craig Wright’s trading account was found. Not that long ago, I had my calculations confirmed by Nobuaki Kobayashi, the trustee of Mt Gox.

Case Against Craig Wright

And knowing that Craig lost less than 15 Bitcoin in the Mt Gox collapse, and didn’t bother about claiming them back, it becomes quite hilarious that during the Hotwire bankruptcy case of April 2014, Craig called these less than 15 Bitcoin “significant exposure” which made him “no longer […] able to provide financial accommodation”.

View image on Twitter

April 27, 2013

Then, the Mt Gox experience unleashed the writer in Craig. This is his first full article on Bitcoin, and quite a lengthy one also. Note that he finally had learned how to spell Bitcoin correctly.

[Editor’s Note: for details about this now-deleted blog and where it can be found in internet archives, see Part I] 

Case Against Craig Wright

What is interesting here, is how Craig ends his very first Bitcoin article.

Case Against Craig Wright

“I’ve placed my bet” – Craig Wright

And this is correct. Craig, on the exact date of this article, owned 48 Bitcoins after a few days trading on Mt Gox. Craig had just entered the Bitcoin rabbit hole, and from here his hijack of the Bitcoin project, including a false claim to be Satoshi, would start.

And on the same day, another long article about Bitcoin.

Case Against Craig Wright

April 28, 2013

And Craig Wright just couldn’t let go of the Bitcoin subject, as the next day he publishes his third article!

Case Against Craig Wright

April 29, 2013

And one day later, another Bitcoin article.

April 30, 2013

Dave Kleiman
Dave Kleiman (via Wikimedia Commons)

Then, again a day later, Craig Wright finds out Dave Kleiman has died. So Craig writes an In Memoriam on his blog.

Note there’s not even a tiny hint to Bitcoin at all, supposedly their multi-million “partnership” project since 2008? Instead, Craig states “we’ve sparred verbally as friends about many topics in security and digital forensics” as that was the only field where they cooperated a few times. In real life, Dave and Craig never cooperated in anything Bitcoin, as far as we know. 

Let’s focus on what we do know. I haven’t seen proof that Dave and Craig didn’t work together.

There is no untampered proof for that.

Case Against Craig Wright


May 2013 onward

You say it’s Craig’s private businesses that show us the next stage of this debacle.

Yes. Not many people know about this, but Craig Wright is still under criminal investigation by the Australian Taxation Office (ATO) in Australia since the December 2015 raid as we learned in the Kleiman v Wright lawsuit. 

I don’t know that we can say he is “still” being investigated.

But to summarize those business endeavors in the early years of Craig entering the Bitcoin arena: Craig, after learning about Bitcoin in July 2011, somewhere around April 2013 he not only decided to try trading some Bitcoins, he also decided to create a business model around Bitcoin. With a Bitcoin bank, exchange, something with micro transactions, consultancy, e-learning centre, etc. So in Australia he raised Coin-Exch Ltd Pty in April 2013 and several other companies after that. The concepts of these businesses were kind of legit, I’ll give him that. 

Case Against Craig Wright

OK.

But the financial foundation of it was not exactly legit. With a fraudulent setup that Craig created in the second half of 2013 around W&K (an US company set up by Dave Kleiman in 2011 in which Dave & Craig tried to get funding for 4 Homeland Security projects, which failed in 2011), he tried to obtain, on paper only, Bitcoin related Intellectual Property and Bitcoin mining revenues. Craig also sued MJF Mining, a company where he supposed to have a AUD 85 million gold deal. With help of court Australia, who surprisingly bought these made up stories, Craig obtained, again on paper only, AUD 115 million in value, and used that paper only value to create an Australian R&D tax return scheme. First under the Hotwire moniker in 2013/2014 for AUD 9.6 million, and when Hotwire went belly up in April 2014, repackaged under the DeMorgan moniker in 2015 for another tax fraud of AUD 54 million.

September 15, 2013

But first, on September 15, 2013, we get our first hint on his blog of the Bitcoin fraud that Craig Wright is setting up. It’s called Hotwire.

In that post he laid out his strategy: “To this end, we have devoted: Fifteen years of planning; Four years of development; Ten companies in a consolidated group; A five year, $x million development budget. And so far…. It is still secret. In the next nine months, secrets will start to come out.

Except for the 10 companies, the whole statement is laughable. Note for example that Craig talks about a five-year, multi-million development budget. We will quickly learn this is a lie, as such a budget never existed. And the “secrets” would indeed come out: Craig would try to become Satoshi Nakamoto.

Case Against Craig Wright

February 12, 2014

Here we date the first known false claim of Craig Wright pretending to be Satoshi Nakamoto. This is the moment when Craig contacted the Kleiman family, mentioning that the late Dave Kleiman was also involved with inventing Bitcoin. Again, there are no indications whatsoever that Dave Kleiman had anything to do with Bitcoin before his death in April 2013. And as we know by now, this contact would end up with Ira Kleiman (Dave’s brother) suing Craig Wright for a long list of complaints four years later in 2018.

The $5 billion email
Case Against Craig Wright

Then, on February 14, 2014 Craig launched Hotwire with an AUD 9.6M tax fraud in the books.

Tax fraud of wishful thinking?

April 2014

On February 28, 2014 Mt. Gox went bankrupt. On April 28, 2014 Hotwire followed suit, as Craig claimed he couldn’t provide “financial accommodation” anymore (with the less than 15 Bitcoin he had there, as we learned earlier). So there was no five-year, multi-million development budget either, as the whole scheme was based on receiving the AUD 9.6 million R&D tax incentive claim from ATO, which failed.

Case Against Craig Wright

Some of CW's early Bitcoin companies

The nine companies in the Hotwire group were then repackaged in DeMorgan, which claimed in May 2015 to have landed AUD 54 million in R&D tax incentives. However, as far as we know, ATO never paid a penny of this amount.

Eventually, the Australian Taxation Office (ATO) didn’t buy it. In their Coin-Exch Pty Ltd reporting they stated:

You have not employed any staff […] There is therefore no evidence that you were conducting an enterprise

Case Against Craig Wright

What is notable here; Craig, in later years, declared many times that ex-staff hacked his servers for many years, and this ex-staff created the #Faketoshi forgeries on these servers, to bankrupt his companies. Although Craig did employ some staff for a short period with Hotwire/DeMorgan as far as we know, his claim about ex-staff is questionable to say the least. The Hotwire group, mostly consisting of “no evidence that you were conducting an enterprise” companies, lasted only a few months (announced February 2014, bankrupt by April 2014) and this makes me fairly certain that Craig created all the forgeries himself to perform this tax fraud and to support his false claim to be Satoshi Nakamoto. Talking about Craig’s ex-staff, they were pretty outspoken about Craig too.

Case Against Craig Wright

September 25, 2015

The Amazon review

But then what’s up with this book review? It sounds exactly like Craig.

In September 2015, Craig expresses his frustration on an Amazon book review about still not being publicly recognized as Satoshi Nakamoto. This is one of those telling moments again in Craig’s career of trying to be someone he isn’t.

Always Nick and others at the end. Always the assumption that S[atoshi] N[akamoto] must be a bloody yank. […] I did not know most of this as I was too focused on my own work and missed the outside growth.

This desperation, combined with the ongoing struggles with the ATO, would lead to Craig’s self-dox [with Wired and Gizmodo] a few months later. 

That’s mostly speculation.

So while all his Hotwire/DeMorgan related companies got raided in December 2015, Craig is outed as, possibly, being Satoshi Nakamoto.

December 8, 2015

This date is important, because when ATO got fed up with Craig trying to repeatedly fraud tax money from them, they raided his house and office in December 2015, coincidentally or not almost on the exact same moment of the publication of Craig’s self-dox to Wired/Gizmodo. My website contains links to all the articles and other information about that period.

Haha! Something caught my eye on your website and I want to share it.

What part?

There’s a section that starts:

– Video: Craig lies about having kissed Jim Morrison

– Video: Craig meltdown during GQ interview

– Video: Craig lies about never appearing on tv again

Haha!

For the record, I just watch the video and when Craig says he “kissed Jim Morrison” it’s kind of his deadpan humor. Like if you came back from a rave and your friend made out with a girl with green hair you’d be like, “Jeff’s off with Billie Eilish.” But go on!

Together they make for a very interesting read about the turmoil that Craig created in December 2015. It will not surprise you that no source is convincingly making the point that Craig is Satoshi, in fact they all question or straightforward reject Craig’s claims.

Case Against Craig Wright

2016-2018: After the Wired/Gizmodo interview

The “self-dox” you refer to is when nChain bought Craig’s patents in 2015 and had a PR company handle the “leak.”

No. The self-dox is when Craig sent, anonymously, documents to Wired/Gizmodo that “proved” he was Satoshi with the lame excuse it was sent by someone who had worked with Craig Wright. Many of the documents provided in the self-dox, like contracts and emails, have been called out as backdated forgeries. So this claim of Craig being Satoshi Nakamoto has been questioned from the beginning, for example in a very good article by Splinter News which created a timeline of events in the months before the Wired/Gizmodo articles. To add, Craig never investigated let alone sued somebody for these presumed years-long hacks and self-proclaimed unwanted doxing. This, to me, is telling, as Craig has never been afraid to call out people that he doesn’t like, or to start lawsuits against people who did not support his narrative.

What if the “real” Satoshi steps up?

I can see how these all line up now. The question I can’t quite figure out is: how can Craig be so certain that no one else has proof of who Satoshi Nakamoto is? If ALL of this is fraud and someone has a document or a recording in a safe somewhere then Craig could go to prison and nChain could sue him and everyone he’s ever met. How could he be so certain?

That’s a good question. I can only guess here, and admittedly that’s outside of my comfort zone of fact checking. So feel free to agree or to disagree with me here. 

I think Craig slowly built confidence over the years. His first known Faketoshi come out is dated February 2014. Hints to this come out can be found in late 2013

From there, Craig’s Faketoshi forgeries can almost all be dated to 2014 (his Tulip [Trust] related forgeries for example have been painfully nailed down from many angles to October 2014) and 2015. Craig slowly started infiltrating the Bitcoin community halfway 2015. His self-dox to a global audience was in December 2015. Craig tried a few Bitcoin signing sessions in 2016, and failed in all cases. So the BTC community didn’t accept him as a possible Satoshi. Then, Craig tried infiltrating the BCH community in 2017.

This part I know about, because when I interviewed him at the time he said, “Bitcoin Cash IS bitcoin.”

Yes, true. Craig has no issues changing his story when the situation asked for it, but in this case his version of the real Bitcoin ended up with a BCH knockoff in November 2018 called BSV. 

There was a hash-war when BCH broke away from BSV.

Yup. And all this while, the real Satoshi didn’t call him out. And I think I understand why.

OK, let’s pretend the real SN is alive and watching all this happen. Why doesn’t he step in?

Presuming the real Satoshi Nakamoto is still alive, I don’t think he’s bothered too much by Craig Wright. Just like the Bitcoin OGs are totally not bothered by Craig either. Because Craig is just one of the few handfuls of Faketoshis that we’ve seen over Bitcoin’s lifespan. 

Let’s be honest, Craig Wright is pretty irrelevant in the grand Bitcoin scheme. 

Kleiman v Wright

Perjury is a crime in civil cases. The jail time for that is five years.

True. But only when criminal intent and criminal behavior is extensively proven and subsequently trialed in court. [Which is rare. –Ed.] Craig might end up in jail. Civil cases can have such criminal upgrade, and for example ATO is still in the process of executing a criminal inquiry on Craig Wright after the December 2015 raids, as we accidentally learned in 2019 in the Kleiman v Wright lawsuit. So we might see new raids, more fines and/or lawsuits there too.

[Editor’s Note: The Kleiman v. Wright lawsuit was filed on Feb. 14, 2018 in the federal district court for the Southern District of Miami. A great deal of what we know about Craig Wright’s explanation’s about his ongoing inability to prove he is Satoshi Nakamoto by accessing that cache of 1.1 million bitcoins comes from discovery in that case. Presiding Judge Beth Bloom has flat out called Wright a liar. Magistrate Judge Bruce Reinhart, who is overseeing discovery, did the same and declared some of the documents Wright presented to be forgeries. He also found, as a matter of fact, that the Kleiman estate was owed half of Wright’s pre-2013 bitcoins (however much that may or may not be).]

Then there could be serious fees. All bitcoiners hate fees. Craig is looking at a couple of million dollars just to pay his legal fees.

Anyway, time will tell how this pans out for Craig. Craig getting several serious monetary fines which he can’t pay, and which will make him flee to Antigua where he holds a second citizenship is also a likely scenario. Will one of Calvin Ayre-controlled entities like nChain, Coingeek, or Taal sue Craig in the process? Presuming they’re not complicit in Craig’s scam, they might.

And meanwhile, you know, Bitcoin’s dynamics circle around an equilibrium of consensus between users, developers, and miners. Satoshi said, and I find this one of his most brilliant quotes, that Bitcoin minority versions would end “pretty ugly”. 

An “ugly end” to BSV?

That sounds like such a Craig Quote! I could see him saying that about Bitcoin Private, but BSV is supposed to be a return to the original protocol that Satoshi was talking about.

It’s not a Craig Wright quote, it’s a Satoshi Nakamoto quote from the Bitcointalk forum. And nothing is farther from the truth. BSV is doing literally everything that Satoshi Nakamoto opposed. Satoshi didn’t want an immutable blockchain, as he explained in chapter 7 of the Bitcoin whitepaper. He also never wanted data and files in the blockchain, as he explained in several BitDNS discussions. Satoshi also clearly wanted Bitcoin to scale off-chain, with only modest rises in the blocksize to support such scaling. Satoshi didn’t want wallet addresses to be frozen and transactions to be reversed, instead he wanted transactions to be irreversible within two hours. Satoshi didn’t want the protocol to be set in stone (but instead, he said the design was set in stone, which is a totally different thing).

So whoever claims that BitcoinSV has anything to do with the supposed return to Satoshi’s Vision, is either brainwashed, delusional, or complicit in Craig’s BSV scam if you ask me.

And talking about ending “pretty ugly,” Satoshi was right more than 70 times already, as over 70 Bitcoin knockoffs have died so far. Craig’s brainchild BSV is one of such minority versions. As I explained earlier, BSV has no resemblance whatsoever to anything Bitcoin anymore. BSV has no consensus in the real world. BSV has a long-term failing business model, both economically and technically. Hashpower and token price discovery of BSV is already abysmal in the big picture.

To summarize: Liar, liar, pants on fire!

What does your research show?

Simple. In summary:

  • Craig Wright learned about Bitcoin in July 2011.
  • He bought his first Bitcoin in April 2013.
  • After the death of Dave Kleiman in the same month, Craig set up a Bitcoin hijack fraud around Dave.
  • There is no evidence that supports Craig’s claim to be Satoshi. None.
  • All “evidence” before April 2013 is only provided by Craig, and all of that evidence turned out to be backdated forgeries from after April 2013, filled with numerous date mismatches, wrong historical references, and a total lack of understanding of anything Bitcoin.

You can find all the old and new debunks, properly sourced, linked and credited to the people executing them, on my webpage.

If it wasn’t for the duped investors, ex-employees, and taxpayers, the immense list of forgeries and false claims built since April 2013 would make for a hilarious comedy show by Craig Wright. Instead, it will now probably take several lawsuits and a social and/or technical implosion of the BSV project to get rid of this individual and his knockoff project of a forked altcoin.

To add, another central point of failure is Calvin Ayre. He owns some 80% of everything BSV, like mining, protocol development, patents, apps… When Calvin stops being the BSV sugar daddy (he claims to have invested over EUR 100 million in Craig and BSV), for example when Craig Wright has become a costly burden when his patents keep on being unsalable and his frivolous lawsuits become unpayable… consequently, at some point, destruction of the whole BSV scheme will be unavoidable.

Well, time will tell. I can see now why you’ve made the claims that you’ve made based on the research you’ve organized. I appreciate you putting it all in one place. But I still wonder what we’ll think if more information comes out. 

Brendan Sullivan is a writer, producer, and author of the memoir Rivington Was Ours: Lady Gaga, the Lower East Side, and the Prime of Our Lives. Disclosure: he owns cryptocurrencies. Follow him on Twitter.