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hi welcome to another episode of cold
fusion before we get started
i just want to say thank you to everyone
who joined the discord i know it was a
bit chaotic to begin with but we’ve got
some moderators in there now and it’s
calmed down
thanks to those of you who are willing
to help alright so on to the video
in the previous episode we took a look
at how cryptocurrencies were born in the
1980s
and then we followed their underground
struggle in the 1990s
a group of individuals risked prison
time because they believed in total
financial freedom from the government
today we’ll dive into the civil war in
the modern bitcoin community
and see how some believe that the
cryptocurrency has been co-opted by
banking interests
and lastly we’ll take a look at some
theories into who satoshi nakamoto may
be
let’s begin you are watching cold fusion
tv
one of the first things you need to
understand to grasp the modern state of
bitcoin
is the block size wars as we discussed
in the last episode
bitcoin is mined in blocks these blocks
contain a record of all the most recent
transactions
the size of these blocks measured in
megabytes have a meaningful
impact in the way that bitcoin functions
satoshi originally placed a one megabyte
block size limit on bitcoin
so why did he do this well satoshi
didn’t want some miner on the network to
create a huge block
terabytes in size that could clog up the
entire system
as time went on this one megabyte block
size limit
made bitcoin hard to scale as more users
came online
as more people used the bitcoin system
payment times became longer
and fees became higher even to date
bitcoin can only do about 7 transactions
per second
for context paypal does about 15 and
visa
2 000 transactions per second
but satoshi knew this was coming and in
his original writings he remarked
that bitcoin would be updated with
larger block sizes
as it scaled so here’s where the issue
arises
there was a fundamental split in the
community it was over the question of if
bitcoin was a long-term store of value
like gold or a quick medium of exchange
like cash within the bitcoin developer
community
so-called big blockers wanted bigger
block sizes
so more transactions could take place
this would make bitcoin function closer
to a method of payment and electronic
cash
on the other side of the aisle was the
small blockers they saw bitcoin as a
store of value
so transaction speed and efficiency
didn’t matter as much
in their eyes the original one megabyte
limit was fine
why risk messing with it according to
the small blockers
having large blocks would make it hard
for some computers to handle
they stated that eventually only large
companies with powerful computers would
dominate the network
forming a monopoly in 2015
gavin anderson whom satoshi left in
charge after vanishing
and a google developer by the name of
mike hearn would team up together to
tackle this problem
their solution was the release of
bitcoin xt
equipped with a two megabyte block size
that was set to increase over time
and capable of 24 transactions per
second it looked promising
and the miners in the community were on
board if the majority of the bitcoin
community
downloaded the bitcoin xt software and
decided to run it on their nodes
the community would have voted with
their machines and the issue would have
been settled
but there was strong opposition the
small blockers saw this as a betrayal
the technical experts should determine
the direction of bitcoin
and not a populist campaign from here
things got bizarre strangely due to a
multitude of reasons
and some possible foul play bitcoin xt
ultimately didn’t reach mass adoption
garnered a lot of support a lot of
miners especially were like hey
this is great i would love to mine
bigger blocks there’s more money
in a bigger block for me so why would i
not go that direction
well all of a sudden dos attacks
tons of data is pushed across a network
forcing a node to crash
mike’s entire regional isp was dos
attack for days
all of these xt nodes got pushed off the
network only isps where xt nodes existed
were
were dos attacked strangely
online the main reddit bitcoin forum
would ban anyone that talked about
bitcoin xt
mike hearn in 2016 stated quote
why has bitcoin failed it has failed
because community has failed
what was meant to be a new decentralized
form of money
that lacked systematically important
institutions and too big to fail
has become something even worse a system
completely controlled by just a handful
of people
end quote there was now some obvious
contention within the bitcoin community
within the community of bitcoin
developers the search to fix the scaling
problem was still taking place
the idea of a segwit or segregated
witness was introduced
activated in 2017 its aim was to store
transaction data in a smarter way
so more data could fit onto a given
block
basically they removed the cryptographic
signature from the block
only leaving the receiver and sender
information
this process made room for more data
in august of 2017 some bitcoin
developers
weren’t happy with the proposed segway
method so they worked on a new version
of bitcoin
and split it off from the main chain a
process known as a hard fork
the result was bitcoin cash bitcoin cash
had none of the data saving techniques
of segwit
and an increased block size of 8
megabytes
at this point things start getting a
little messy after some time
the developers of bitcoin cash wanted to
include even more changes
a man by the name of craig wright
thought that this would cause bitcoin to
stray from its original purpose
interestingly some people believe that
craig wright
is satoshi but more on him later
in 2018 craig led the charge to split
from bitcoin cash into what would be
called
bitcoin satoshi vision or bitcoin sv for
short
it has no block size limit and features
super low transaction fees
there is a belief among the bitcoin
satoshi vision community
that bitcoin sv is the real bitcoin
according to them bitcoin sv is
technically superior to the mainstream
bitcoin
and it can do more than 2 000 times the
amount of transactions per second
it’s more flexible yet only trades at a
small fraction of the price
on the other side of the fence the
entity coin geek currently controls over
51
of the computing power available for
mining bitcoin sv
which critics say can lead to
manipulation
others such as vitalik the creator of
ethereum calls bitcoin sv
a complete scam like obviously vsp is a
complete scam
so as it stands today due to infighting
and differing opinions
bitcoin is split into three the
mainstream bitcoin
bitcoin cash and bitcoin satoshi vision
but what if all of this fracturing
should have never happened
what if there was more going on behind
the scenes
in 2014 while the scaling problems were
being discussed in full swing
a company by the name of blockstream was
founded
the stated purpose of blockstream was to
quote
sell sidechains to enterprises charging
a fixed monthly fee
and taking transaction fees in other
words
its aim was to relieve the stress on the
bitcoin network by doing transactions
off-chain
and pocketing the fees instead of miners
it’s important to note
that a side chain is not a blockchain at
all side chains are typically used
to patch holes in the capabilities of
the underlying protocol
therefore the better bitcoin becomes the
more obsolete
companies like blockstream get in my
opinion it was in blockstream’s
interest to keep bitcoin slow and
therefore with a small block size
[Music]
it’s worth noting that blockstream isn’t
a foundation
but a for-profit corporation
interestingly
blockstream’s ceo is adam back who some
also believe is satoshi nakamoto but
during the researching for this video i
could see that a large part of the
bitcoin community was suspicious of
block stream
many take issue with blockstream’s
lightning network for example
it promises to boost bitcoin’s
transactional speeds to faster than visa
but at what cost
the original bitcoin system promised no
middlemen
and no trust required suddenly
the blockstream corporation had broken
these promises
so the lightning hubs were required to
be set up for financial regulation
and reporting laws require massive
amounts of liquidity to keep multiple
well-funded open channels
offer fraud departments to watch the
blockchain constantly and prevent theft
all while taking small fees for every
transaction you route through them
does this system sound familiar
just replace the term open channel
with checking account these lightning
network hubs
will be ran by the same financial
institutions the bitcoin was made to
challenge
the banks aren’t fighting bitcoin
because bitcoin
will be the new banking system bitcoin
needed no middleman
there was no fraud to detect no
permission to give no transaction to
reverse
no fees to collect so it had to be
broken to need them
the truth is the one megabyte blocks
restricting bitcoin
are purposely kept there by the
developers the absurdly high fees
and long waits created demand for a
solution and the solution they give us
is the banking industry
to make things worse the entities
funding blockstream
are antithetical to the original bitcoin
vision blockstream has received
55 million dollars of investment from
axa insurance
the ceo of axa at the time was henry de
castris
a french billionaire and the president
of the bilderberg group at the time
a group known to have global banking and
corporate ties
critics also point out that blockstream
has received funding from the digital
currency group
many higher-ups within the company have
ties to the federal reserve
world bank and mastercard not exactly
the crowd who you would expect to
spearhead a grassroots movement
they also own coindesk one of the
biggest news outlets in the crypto space
adam back has also been criticized for
hiring all the early bitcoin devs into
blockstream
to reshape the bitcoin protocol to many
it seems that blockstream has crippled
bitcoin’s full potential
through their group of developers only
to seek to fix its shortcomings
for a profit so through block stream
have the banks taken over bitcoin
it’s not quite a smoking gun but it’s
all very curious
satoshi nakamoto the pseudonym for the
inventor of bitcoin
has gone to great lengths to hide his
identity he created an anonymous email
account
and never shared any personal details
he’s left
such few clues that the best one can do
is point out the facts that lead to the
most likely candidates and then i’ll
leave it up to you to make up your own
mind
firstly for nakamoto we need to lay some
groundwork with two basic clues
number one bitcoin’s original code was
written in the programming language
c plus number two
satoshi had two language quirks he would
use british english over american
english
and consistently used two spaces after a
period
this common writing style hints that
satoshi is not a group but a single
person
our first candidate isn’t the most
serious but he’s worth mentioning
because he ties into our second
candidate
the least likely candidate is dorian
nakamoto
a japanese-american physicist and
engineer in 2014
a newsweek article published a photo of
him as well as his home which could be
easily found
via a google search the article claimed
that he was the founder of bitcoin
solely due to his name basically lazy
journalism
when accused nakamoto stated that he had
never heard of bitcoin before and it
would seem completely strange that
someone as obsessed with cryptography
and anonymity would just
go ahead and use their legal name as an
alias
but the main reason i’m here is to
clear my name that i have nothing to do
with bitcoin
nothing to do with developing um
i was just an engineer doing something
else that’s not me
i never communicated with bitcoins okay
the media attention dorian received was
unnecessary and dangerous
thankfully the bitcoin community came to
dorian’s aid and collectively donated
102 bitcoins
a donation now worth close to 5 million
dollars
[Music]
as we saw in episode 1 satoshi didn’t
work alone
he worked closely with hal finney a
cryptographer and part of the cypherpunk
movement
before going public satoshi spent a year
and a half coding
sharing his work privately among a
select few
hal finney would also receive the very
first bitcoin transaction
coincidentally hal lived just down the
road from dorian nakamoto
perhaps they had bumped into each other
and hal decided to use nakamoto’s name
as an
alias in 2009
hau was diagnosed with als this
coincides with when satoshi would slow
down posting in email forums
on the flip side if he was testing code
for satoshi why would he put bugs on his
own code and then solved them himself
in hindsight with bitcoin’s popularity
one might think that it was a
sophisticated ploy to throw people off
the scent
but you must remember these were the
earliest days of bitcoin and it could
have flopped over and disappeared a week
from then
for all they knew this would suggest
that it wasn’t him
howard post as himself on other forums
and even on his deathbed he denied being
satoshi and even stated that he didn’t
really understand bitcoin at first
sadly hal finney died in 2014
and was cryogenically frozen he decided
that he wanted to be cryogenically
frozen
because one day he still wanted to see
the future since we’re still talking
about him today
in a way he’s made it
the next candidate is our old friend
nick zabo
he’s a first generation hungarian and
his father fought in the 1956 hungarian
revolution
nick would have a unique perspective on
governments abusing their power
he has a computer science degree from
the university of washington
and was proficient in law and economics
as you saw throughout the previous
episode nick has been an active
participant in almost every stage of
cryptocurrency history
and was close to a complete breakthrough
with his invention of bit gold
zabo had also worked for david charms
digicash an early attempt to bring
cryptocurrency digital payments
he has the knowledge experience and a
decade’s long passion for cryptography
based money
he’s even credited with pioneering the
concept for smart contracts in the 1996
paper
before bitcoin wallets were used the
protocol was to use ip addresses to send
bitcoin to each other
satoshi’s ip address was in california
and nick
did indeed work in the area what i find
most interesting
is that there was an exchange between
satoshi and another cryptographer
in the exchange satoshi remarked that
his bitcoin address
also happened to have his initials in it
looking through all of the initials
combinations
out of all the candidates that could be
satoshi only one of the initials match
n s although these initials could just
be satoshi nakamoto reversed
on the opposing side though nick zabo
has denied satoshi claims
in addition bitcoin was coded in c-plus
plus
and wei dai the inventor of b-money
states that nick
didn’t code much in c or c-plus plus
nick also doesn’t match the british
linguistic clues
[Music]
craig wright is probably the most
controversial of the bunch
he’s a well-accomplished australian
scientist who also holds a bunch of
other degrees
he was first accused of being nakamoto
in 2015.
the difference between him and the other
suspected founders
is that while denying it first he
eventually claimed the accusations to be
true
greg anderson who worked closely with
satoshi believed craig was the real deal
after craig performed a digital
signature on an address known to be
owned by satoshi
craig would also fit the british english
clue because both australian and british
english
are pretty much interchangeable wired
magazine had collected a number of
interesting coincidences that led them
to their conclusion
they include posts on wright’s blog that
coincide and predict
the release of the initial bitcoin paper
there is also said to be leaked
correspondences between
wright and attorneys where he states
that he’s been running bitcoin since
on the flip side it wasn’t long before
wyatt and the crypto community
began pointing out inconsistencies in
craig’s story
the timeline became even more blurry
when new evidence seemed to prove that
craig’s blog post had been backdated
and i don’t work and invent and
write papers and code by coming in front
of tvs
i don’t want money i don’t want fame i
don’t want adoration i just want to be
left alone
you come in front of my camera once
and i will never ever be on a camera
ever again
for any tv station or any media
everyone’s saying
i don’t ever want to be in the public
again you know you followed my family
you bothered me you’ve got the people i
work with
this will be the last time that you ever
see me those words from your mouth
television one that was an
hour interview that was cut and changed
but you’ll find out important
are you sufficient yes okay
so you wrote the satoshi white paper yes
you’re only a public figure because you
cosplay
right
[Music]
it also seems unlikely that nakamoto
would spend
seven years being anonymous just to take
credit when accused
further in 2020 craig wright had
provided a list of early bitcoin
addresses which he claimed to own in an
ongoing court case
these addresses were briefly
inadvertently made public 145 of these
addresses were used by an
individual who did own them to sign a
public message to prove
that craig was not the owner the message
read
quote craig stephen wright is a liar
and a fraud he doesn’t have the keys to
sign this message
this was a major blow to the theory that
craig was satoshi
but many bitcoin sv supporters
wholeheartedly believe
that craig is satoshi
thanks to a 2020 documentary by the
youtube channel
barely sociable the most recent
candidate during the rounds is adam back
adam ticks the majority of the boxes and
seems almost a perfect match
apart from one thing but more on this
later
adam was an early pioneer in digital
currency research along with everyone in
episode 1
wei dai david charm and hal finney
adam has a phd in distributed computer
systems
a perfect match in 1997 he invented
hashcash
a similar system is used in the
proof-of-work mining algorithm in
bitcoin
both satoshi and adam wrote in british
english and used the unique double
spacing in writing
this can be seen by comparing adam’s
writings and forums with satoshi’s
papers
satoshi never showed any emotion or
clues into his personality
but in one post in july of 2010 he
described that bitcoin was
quote bloody hard to describe and that’s
a very british thing to say
other evidence that points to adamus
satoshi is the fact that messages
between the creator of bitcoin and adam
are not available to the public
there exists email exchanges between
satoshi and almost everyone else apart
from adam
in addition adam codes very well in c
plus
the same language that bitcoin was
written in
in the first episode we saw that the
first block of bitcoin
included a headline from the times paper
the times is a british publication which
would make sense because adam was from
london
adam was also known for starting the
trend of making political statements in
code
he printed it on a t-shirt and then so
if people flew
internationally with that t-shirt on
then they were breaking this law
is that the case i don’t know i mean
if you can export a book can you export
a t-shirt at a sub of a gray area i
guess but
at least it it people thought it was an
amusing
kind of way to protest something that
they were quite unhappy about in 2013
when the wealth of nakamoto was revealed
in a blog article adam registers to sign
up to the bitcoin forum on the very same
day
in forum posts adam states that the blog
authors are
quote getting too close to the dealings
of nakamoto
despite only just joining the forum he
knows obscure details of early bitcoin
bugs that were never public in change
logs
if you’re interested in digging more
into adam check out barely social’s
youtube documentary it has some
compelling arguments
but adam would deny all claims made in
the video
and for me though there’s one thing that
stops me from believing satoshi is adam
if satoshi’s vision for bitcoin was to
have ever increasing block sizes
why would adam through blockstream be
actively trying to keep bitcoin’s block
size small
for a profit why would adam want any
money at all
he’d probably be one of the richest
people in the world if he was satoshi
am i missing something here the only
thing i can think of
is maybe adam worked extremely close
with satoshi but for one reason or
another
ended up selling out to the big banks
so who is satoshi i’ll be honest
i’m stumped for this one if you guys
think you have any clues for me
hit up my discord maybe we can
crowdsource this thing together and
figure it out
i’ve set up a new text channel for the
discussion around satoshi
in truth discovering the identity of
satoshi nakamoto is not necessary for
the success of bitcoin
he or she could be one of these
candidates or
just someone who is truly unknown until
this day
and with that that pretty much brings us
to the end of our bitcoin series
in part one you saw how free thinkers
took digital cryptography seriously in
the 80s and 90s
their efforts allowed bitcoin to exist
in this episode
you saw that the story of bitcoin may
not be as simple as it first
seems in the end another cryptocurrency
may come and take its place as the
global leader
no matter what happens bitcoin will
always be known
as the pioneer
if you enjoyed learning some new things
in this episode then you’ll probably
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so thanks for watching the whole way
through this episode be sure to check
out the first part of this series if you
haven’t already i’ll leave a link for
that below
anyways my name is tagogo and you’ve
been watching cold fusion
next time we’ll take a look at the rise
and fall
of atari cheers
[Music]
oh