Newsweak: Once-great news magazine hypes relaunch by putting a man's life at risk

By Michael Carney and Nathaniel Mott , written on March 6, 2014

From The News Desk

[This post has been updated to reflect additional reporting by the AP, public statements from the Bitcoin Foundation, and a public comment from the original bitcoin poster by the name Satoshi Nakamoto.]

Newsweek claims to have found Satoshi Nakamoto, the highly-secretive creator of Bitcoin. If the report is accurate, he is a 64-year-old Japanese-American man who lives in a Los Angeles suburb and goes by the name of Dorian S. (Satoshi) Nakamoto.

But the report, authored by Leah McGrath Goodman, offers only circumstantial evidence to support its findings. Goodman cites the speculation of Nakamoto’s family and alleged co-workers, evidence found online and in public databases -- and even the quasi-denials of the man himself -- as evidence of Nakamoto’s status as the figure behind this multi-billion dollar crypto-currency revolution. Thus far, Nakamoto, who has gone by the name Dorian for 41 years, has not issued any public statements.

But absent a concrete confirmation from Nakamoto, the question remains whether Goodman’s story should have been published in the first place. This, after all, is a story about a private citizen, who is not accused of breaking any laws, who has just been named as the owner of $500 million dollars in Bitcoin and who many believe is partly to blame for the losses around Mt Gox. Newsweek identified his home (including a photograph of his house, including his car and license plate), his family members and certainly enough other identifying information to allow others to track him down. Sure enough, the LA Times reports that Nakamoto has already been mobbed by reporters. Fortunately, that's the worst that has happened so far.

Minutes after Newsweek's story hit the web, Nakamoto's exact address was published by amateur sleuths on Internet message boards. This information joins details of his medical issues and the names, ages, and cities of residence of his family now public thanks to Newsweek. The details have already made it into the “Satoshi Nakamoto” Wikipedia page.

Newsweek returns to print today, for the first time in 15 months, with a "VIP party" at SXSW and their Nakamoto story as it's launch scoop. It's possible that Newsweek's eagerness to restart with a bang has led to the rushing, or over-sensationalizing, a story that has the potential to put lives at risk.

In her own defense, Goodman – who tweets from the handle @truth_eater – wrote "Yes, there were [discussions of risk to Nakamoto]. We felt showing he lives humbly [by including photos of his home and car], despite his achievement, was both telling and inspiring."

Again, while it is certainly possible that Nakamoto is the real creator of Bitcoin, the case is still far from concrete.  As evidence, Goodman reports that...

  • “Nakamoto - and his entire family - excels [at math];”

  • “his brother suggested Nakamoto would be capable of starting Bitcoin;”

  • “Nakamoto's family describe him as extremely intelligent, moody and obsessively private... [and] preoccupied with the two things for which Bitcoin has now become known: money and secrecy;”

  • “[Nakamoto’s wife says he] veers between highly abbreviated verbiage and a more formal, polished style [much like bitcoin’s creator];”

  • “[he is] wary of the government, taxes and people in charge;”

  • “[he had] a career shrouded in secrecy, having done classified work for major corporations and the U.S. military;”

  • “his frustration with bank fees and high exchange rates when he was sending international wires to England to buy model trains;” and

  • “[the period of bitcoin’s creation] a span that falls squarely into Dorian S. Nakamoto's job lapse starting in 2001.”

The report doesn't answer many of the most important questions, like why Nakamoto (purportedly) created Bitcoin, why he decreased his involvement in the last few years, why a man who values his own privacy so much was willing to offer his real name when he created the currency, or why he hasn’t spent his bitcoin millions. It guesses at the answers to some of these questions – Nakamoto doesn't trust the government, has fallen ill in recent years, goes by "Dorian S. Nakamoto," and doesn’t want any notoriety – but offers few hard facts.

Goodman’s most compelling evidence is a quote from Nakamoto himself, which the ambushed man delivered flanked by two police officers he called amid Goodman’s harassment. He says, "I am no longer involved in that [presumably bitcoin] and I cannot discuss it. It's been turned over to other people. They are in charge of it now. I no longer have any connection."

Nakamoto declined to be interviewed any further and asked the police to see that Goodman left him alone.

Even if we're to give Goodman the benefit of the doubt -- that she really has tracked down the creator of Bitcoin -- the next question is whether such clearly identifying details, published without Nakamoto's consent, are of importance (or even interest) to people outside the media.

According to Bitcoin Foundation's Gavin Andresen, the answer is probably no. "When programmers get together, we don't talk about who Satoshi Nakamoto is," Andresen told Newsweek. "We talk about how we should have invested in more Bitcoin. I mean, we're curious about it, but honestly, we really don't care."

[Update (March 6, 5:15pm PST): The foundation has posted a more lengthy response to the Newsweek article, explaining how bitcoin's decentralized nature makes the identity of its creator is irrelevant to its success. The group writes:

Satoshi’s identity may or may not be revealed in time.  Based on current research from Sergio Lerner, Satoshi does not appear to have moved or spent any Bitcoins.  Satoshi is unlikely to be sitting on a beach in Tahiti, next to a multi-million dollar mansion.  Satoshi is unlikely to be prepared for determined, potentially violent thieves and curiosity seekers.  Curiosity in Satoshi’s identity is understandable, but please consider responsible disclosure, and the danger such a revelation may generate.]

Yet Bitcoin message boards lit up with skepticism and outrage at Newsweek’s reporting, calling for retribution against Goodman. This suggests that people care more than Andresen lets on, but that their sympathies are with Nakamoto, not the journalist. A number of public letters of support and thank yous have been addressed to the “real” Satoshi Nakamoto and the subject of the Newsweek article, whether they are one and the same or not.

For his part, Andresen says he’s sorry he spoke to Newsweek at all. He posted an open letter to Goodman on Reddit, criticising the reporter, saying he was “disappointed” that the magazine chose to publish enough personal information that people can easily find Dorian and his family:

The pieces might all be public information, but you worked really hard to piece them all together, and the crazy people who might decide it is a good idea to go visit "Satoshi" are likely not as smart or hard-working as you.

And all of your evidence is circumstantial, EXCEPT for the "I'm not involved in that any more" quote, which might simply be an old man saying ANYTHING to get you to go away and leave him alone.

Anyway, I hope some good comes of all this; I hope it stimulates more debate on personal privacy and the role of journalists in our "pan-opticon" world.

The Bitcoin Association issued a brief statement on its website today calling for restraint and respect for this man’s privacy. It reads, “The Bitcoin Association would like to thank Satoshi Nakamoto for the invention of Bitcoin and would like to ask that media and others respect his privacy if this is his wish.”

It’s been nearly three years since the person or persons known as Satoshi Nakamoto have been heard from publicly or have had any official involvement with Bitcoin. In that time, the crypto-currency has increased in value hundreds of times over, increased global adoption to include millions of users and businesses, and caught the attention of everyone from Wall Street to federal governments around the world. To say that Bitcoin has outgrown its creator(s) is a dramatic understatement.

While uncovering Satoshi’s identity -- if that's what Newsweek really has done -- is arguably newsworthy, there are countless ways to report the fact (and garner all the attendant publicity) without putting a man's life at risk. Especially if the man himself doesn't want to talk.

There's been a lot of talk recently about Reddit's desire to rebrand as a serious news organization. Today we say a once-serious news organization has relaunched as something that feels a lot like Reddit.

PandoDaily’s attempts to make private contact with Dorian S. Nakamoto (~45mins ago) were unsuccessful. A phone number listed for a man of that name in Temple City is no longer in service. Emails and request sent via Twitter to Goodman requesting comment on this article (~ 1.5hrs ago) were not returned by press time. A phone call placed to her number at Newsweek went to voicemail.

[Update (March 6, 5:35pm PST): Following a two hour interview with Dorian S. Nakamoto, the subject of the Newsweek article, the AP reports that the man denies having any involvement in bitcoin. The AP writes:

[He] said he had never heard of Bitcoin until his son told him he had been contacted by a reporter three weeks ago.

...Nakamoto acknowledged that many of the details in Newsweek's report are correct, including that he once worked for a defense contractor. But he strongly disputes the magazine's assertion that he is "the face behind Bitcoin."]

[Update (March 6, 5:55pm PST): Newsweek has posted an interview (branded as parent company International Business Times, not Newsweek) with Goodman in which she defends her reporting of the story, saying she feels "protective" of Nakamoto.]

[Update (March 6, 10:00pm PST): At approximately 6pm PST today, an account by the name Satoshi Nakamoto has commented on the original P2P Foundation post introducting the concept of bitcoin. The new comment reads, "I am not Dorian Nakamoto." If it is in fact the same Nakamoto who made the original posting, it's the first public comment by this person(s) in nearly three years. P2p Foundation creator Joseph Davies-Coates claims in a tweet that the same registered email address was used in both the comment and the original bitcoin posting.]