Satoshi revealed
Who is Satoshi Nakamoto, creator of bitcoin? The question has riled journalists, academics, and the broader public for over a decade. With bitcoin having skyrocketed in popularity to become a trillion-dollar asset used by millions of people, the mystery remains.
This week, HBO heavily promoted a documentary called "Money Electric: The Bitcoin Mystery" that promised to reveal Satoshi’s identity. Speculators placed $44 million worth of bets that the documentary would unveil that Nakamoto was one of various figures like Gavin Wood, Len Sassaman, Adam Back, Elon Musk, or someone else.
The movie claims that not a single person but Adam Back, Peter Todd, and Greg Maxwell were all Satoshi. So, the speculators got burned in a major way.
Feel free to skip watching the documentary itself. Bitcoin historian Pete Rizzo evaluates its claims in this Bitcoin Magazine article and tells you everything you need to know about it. For all of the marketing and product budget, all HBO could muster is some laughably weak "evidence" accompanied by zero critical examination.
Why does Satoshi's identity even matter? To those who understand bitcoin, it doesn’t – but it matters a great deal that Satoshi had the vision and the strength to disappear forever once it had become clear that his invention had given birth to a revolution. If you are interested in watching a thought provoking short film that explains why this act was so extraordinary, check out The Legendary Treasure of Satoshi Nakamoto.
NEWS
Charges brought against altcoin market makers
In a major crackdown, federal prosecutors charged four altcoin market makers – Gotbit, CLS Global, MyTrade, and ZM Quant – with market manipulation and fraud. These firms allegedly offered illegal wash trading services to altcoin projects to inflate their trading volumes and prices.
The U.S. Securities and Exchange Commission (SEC) and the FBI were involved in the investigation, even creating an Ethereum-based token called NextFundAI as part of an undercover operation. Authorities have thusfar secured about $25 million in fraudulent proceeds which are set to be returned to investors.
Why it matters
Typically, bitcoiners highlight the technical differences between bitcoin and altcoins, but this case sheds light on another problem. Many altcoin markets and platforms are rife with manipulation and fraud. Using bitcoin-only exchanges limits your risk of getting burned.
🌇 Bitcoin is the new real estate for wealthy urbanites
In cities like Singapore and Hong Kong, skyrocketing property prices have made real estate ownership a distant dream for many millennials and members of Gen Z. While older generations have seen their wealth soar through rising property values, younger people face financial burdens with long-term mortgages and high interest rates.
Many are pointing to bitcoin as an alternative investment for the younger generation. Its high liquidity allows investors to buy and sell without the hefty down payment and other barriers associated with property ownership.
In Bank of America’s Study of Wealthy Americans released this week, "Crypto/digital assets" (i.e., bitcoin) almost outranked real estate as the category with the greatest opportunities for growth among younger investors.
Source: 2024 Bank of America Private Bank Study of Wealthy Americans
For a deeper look at how bitcoin can inspire renewed optimism and a sense of purpose for a generation often weighed down by pessimism and uncertainty, check out this article we published in Bitcoin Magazine.
🟠 UAE exempts bitcoin from VAT
The United Arab Emirates (UAE) announced that bitcoin transactions will be exempt from the 5% value-added tax (VAT), effective November 15. This change applies retroactively to transactions dating back to January 1, 2018. The UAE's Federal Tax Authority clarified that the VAT exemption covers the exchange and transfer of ownership of digital assets, aligning the bitcoin industry with traditional financial services that are already exempt from VAT.
Countries compete for capital and talent.
In addition to legitimizing bitcoin's role in global finance, this move positions the UAE as a forward-thinking nation that is serious about attracting talent and capital as the bitcoin renaissance grows. If only the U.S. could get its act together...
BITCOIN ADOPTION CONTINUES
Vexl introduces a next-generation P2P bitcoin trading app, enhancing direct bitcoin transactions without centralized exchanges.
Alternative Investment Management Association and PwC survey reveals 47% of hedge fund managers trading in traditional markets maintain bitcoin and altcoin exposure, up from 29% in 2023 and signaling growing institutional adoption.
A Bloomberg analyst forecasts bitcoin ETF options to launch in Q1 2025, expanding bitcoin investment avenues.
Taiwan will debut bitcoin custody solutions with local bank trials starting in 2025, facilitating secure institutional bitcoin holdings.
Kraken's research reveals that most bitcoin investors (60%) use dollar-cost averaging strategies to accumulate bitcoin.
HOW BITCOIN WORKS
Learn one key idea about bitcoin each week. This week:
Every company is a bitcoin miner
Traditionally, bitcoin mining has been dominated by specialized firms investing heavily in hardware and energy to order transactions and generate valid blocks. Mining is a tough business, with high upfront capital outlays, operational risks, and relentless global competition. Miners must continuously scale operations to keep pace with the network's growth – or risk falling behind.
Brian Cubulis from Early Riders offers an unusual new perspective on mining bitcoin in his exceptional research report, Every Company is a Bitcoin Miner. He explains how businesses outside the mining sector, especially those with strong free cash flows and sustainable competitive advantages like brand recognition, proprietary technology, and customer loyalty, can accumulate bitcoin more efficiently than competitors. By allocating a portion of profits to purchasing bitcoin directly, these companies can effectively "mine" bitcoin at a lower cost than even miners can, without the complexities and risks associated with traditional mining. Plus, they are not compelled to sell their holdings to fund operations, allowing for long-term accumulation.
As an example, Cubulis identifies that if businesses like Apple, Alphabet, or Dell Technologies had allocated just 1% of their free cash flows to buying bitcoin starting in the second quarter of 2020, they could have amassed significant reserves over the ensuing four years – potentially surpassing the holdings of major public miners like MARA and RIOT, which hold approximately 26,000 BTC and 10,000 BTC, respectively.
The strategic imperative for businesses includes:
Rising purchasing power: Bitcoin's finite supply and increasing adoption mean its value will likely appreciate over time. Accumulating bitcoin allows companies to protect their purchasing power as the value of government currencies decline.
First-mover advantage: Early adopters can secure lower acquisition costs, attract forward-thinking investors, and gain a competitive edge.
Operational implementation: Companies can designate a percentage of free cash flow for bitcoin investment, accept bitcoin as payment to accumulate holdings organically, and integrate advanced financial technologies to improve efficiency.
By reimagining their strategies, businesses can leverage their inherent strengths to become effective "bitcoin miners," capitalizing on the growth of the soundest monetary asset the world has ever seen.
COIN CHECK
Which of the following is believed to be true about Satoshi Nakamoto?
Satoshi Nakamoto published their real identity in a hidden message within the bitcoin code.
Satoshi Nakamoto holds approximately 1 million bitcoins, but has never moved them.
Satoshi Nakamoto frequently updated the bitcoin community on their location and progress.
Satoshi Nakamoto was revealed to be a collaborative project among major tech companies.
Check your answer at the end of the page.
FROM THE MEME POOL
— naiive (@naiivememe) October 10, 2024
ANSWER
Satoshi Nakamoto holds approximately 1 million bitcoins, but has never moved them. As he was mining the first bitcoin blocks, Satoshi amassed a stash of roughly 1 million coins, which today would represent a staggering fortune. What’s fascinating is that, despite bitcoin’s significant rise in value and influence, none of these coins have ever been moved or spent. This untouched trove, often called the "Satoshi treasure," stands as a powerful symbol within the bitcoin community.
Some speculate that Satoshi’s decision to leave these coins untouched reflects a commitment to the principles of decentralization and financial sovereignty rather than personal gain. This restraint also reinforces the notion that bitcoin operates independently of any central figure, even its creator.
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