One of the biggest modern bubbles that I’ve been meaning to visit in these pages is Bitcoin.
We’ll detail the topic of the Bitcoin bubble in a later post, but I had to mention this recent Wired piece revealing the latest alleged Satoshi Nakamoto to be a 44-year-old Australian named Craig Steven Wright:
There’s also a PDF authored by Kleiman, who died in April of 2013, in which he agrees to take control of a trust fund, codenamed the “Tulip Trust,” containing 1.1 million bitcoins.
That million-coin trove—The Tulip Trust—is the same size as a mysterious bitcoin fortune that’s long been visible on bitcoin’s blockchain and widely attributed to Satoshi Nakamoto. No one but Nakamoto is known to have assembled such a massive hoard of the cryptocurrency, and only Nakamoto could have generated so many bitcoins so early in its evolution, when a bitcoin could be “mined” with relatively small amounts of processing power. Only one such bitcoin megapile exists, and the closely-watched coins haven’t moved in bitcoin’s entire history.
Wright’s blogging and leaked emails describe a man so committed to an unproven cryptocurrency idea that he mortgaged three properties and invested more than $1 million in computers, power, and connectivity—even going so far as to lay fiberoptic cables to his remote rural home in eastern Australia to mine the first bitcoins. His company, Tulip Trading, built two supercomputers that have officially ranked among the top 500 in the world, both seemingly related to his cryptocurrency projects. (Wright seems to enjoy tulip references, a likely taunt at those who have compared bitcoin to the Netherlands’ 17th century “tulip bubble.”)
If this guy really is the creator of Bitcoin… Wow. That is rich.
Of course, there’s a big difference between bitcoins and tulips. After the tulip bubble burst, at least the people holding tulip bulbs had something with some tangible use.