Did Satoshi Move his Early Bitcoin?

Satoshi Scare: What the Heck Just Happened?
By 
Coin Cloud Team
, published on 
May 20, 2020
Did Satoshi Move his Early Bitcoin?

The crypto world is abuzz today with news that the elusive Satoshi Nakamoto, creator of Bitcoin, may have moved 50 BTC that was mined in early 2009, shortly after the digital currency launched.

Whale Alert (@whale_alert), a live tracker of large crypto transactions, posted on Twitter about the first 40 Bitcoins:

40 #BTC (391,055 USD) transferred from possible #Satoshi owned wallet (dormant since 2009) to unknown wallet

ℹ️ The coins in this transaction were mined in the first month of Bitcoin's existence.

The other 10 BTC was moved to a different address in the same transaction.

A "Bit" of History

But while at first glance it seemed to certainly be Satoshi’s Bitcoin, further investigation points to it likely coming from another early miner.

Conceived in Aug. 2008, the first block of Bitcoin was mined on Jan. 3, 2009. At the time, 50 BTC was the reward for miners to successfully create one block on the blockchain. And during the first year, Bitcoin’s name was pretty suitable … it was worth a “bit” of a “coin”. Or, like, practically nothing.

Now, however, just one BTC is worth about $9,500, making a whole 50 BTC reward worth close to half a million dollars. Not bad for 10 minutes of work done 11 years ago.

And So What?

So, who cares if some of that early Bitcoin is being moved around? Well, the concern is that if it’s indeed part of Satoshi’s stash, it’s just a slice of his estimated one million BTC, spread over numerous wallets, all of which has been sitting pretty much dormant for a decade.

Let’s just call his entire fortune $9,500,000,000 worth (that’s 9.5 Billion, by the way). And let’s imagine $9.5 Billion being cashed out all at the same time. Kind of reminds you of the Great Stock Market Crash of 1929, a.k.a. Black Tuesday, where millions of declining shares were traded in a panic, and billions of dollars were lost … which triggered the Great Depression.

Could one guy (or group of guys, or whoever Satoshi Nakamoto actually is) create such a dire situation again? Sure. We’re almost there with the COVID-19 pandemic, so why not?

A million BTC being dumped by its owner would no doubt create a scare in the crypto world, and within minutes all Bitcoin owners could conceivably try to follow suit.

Not Satoshi Patoshi

The good news is, it decidedly was NOT Satoshi moving his Bitcoin from wallet to wallet this morning. It was some other random early miner. There were only a handful of them – maybe a few dozen at most – but it was more than just Satoshi.

Nic Carter (@nic_carter), co-founder of Coinmetrics.io and partner at Castle Island Ventures, laid out a complete thread illustrating why Satoshi probably wasn’t the miner who owned this block of Bitcoins.

“Here's a visualization of the Patoshi pattern with the block that was just spent. The blocks believed to be Satoshi have a specific pattern in the nonce, which this block does not have”

Then he mentioned:

“keep in mind it's basically impossible to prove that Satoshi didn't mine these coins, but the best research we have suggests that Satoshi mined a specific set of blocks, of which this is not one.”

He followed it up by Tweeting:

“Early non-Satoshi mined coins are periodically awakened, just not frequently.”

Small Satoshi Scare

So, chances are it was a false alarm. Nothing to see here, move along. I’m dubbing it the Great Satoshi Scare of 2020. Or, well, let’s stick with Small Satoshi Scare.

Just be ready with a contingency plan if the next time it turns out to be for real!

Keep in mind that you can cash out your Bitcoin any time at Coin Cloud BTMs. We now have over 700 machines … find your nearest one here. And don’t forget the Coin Cloud Wallet app, which can help you track your digital currency and set up your sells.

Disclaimer: The information and views supplied on the Coin Cloud blog are for educational and entertainment purposes only. We are not financial advisors, so please do your research and consult with a trusted financial specialist before investing your money.

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