Picture this. It’s Halloween of 2008, and everyone is mostly feeling apprehensive about the Great Recession.
The DoW just recently suffered its largest-ever weekly loss, and the value of US stocks is currently plunging deep underwater. A month prior, Lehman brothers declared bankruptcy, making it the largest bankruptcy declaration in US history. The firm was mired in debts worth about $619 billion.
Let’s just say things were pretty much as bad as they could be. You could even say it was the scariest Halloween ever for the people on Wall Street.
In the midst of that, something else happens. A fellow named Satoshi Nakamoto decides to submit something called a Bitcoin whitepaper to a cryptography mailing list. The list is owned by Metzdowd.com and is a really popular messaging channel for cypherpunks. Cypherpunks, at the time, were a community of crypto enthusiasts who believed that the key to privacy was encrypted messages.
Of course, Halloween of 2008 passes with no one of any importance taking notice of the Bitcoin white paper. It would be several years before anyone on Wall Street understood the relevance of Bitcoin. And by then, everyone would have the same question: why Halloween?
Yes He Did
If you came here wondering if Satoshi Nakamoto did indeed release the bitcoin whitepaper on Halloween, here’s your answer: yes, he did.
Nakamoto submitted the paper to the mailing list precisely at 2:10 pm Eastern Standard time on 31 October 2008. So, yes, the Bitcoin paper was sent on Halloween.
What Was In The Bitcoin White Paper?
The paper itself wasn’t voluminous and had only twelve sections.
The first section laid out Satoshi’s rationale for creating Bitcoin. He said that the world depended too much on centralized authorities to perform transactions. He explained that this wasn’t only suboptimal but also dangerous.
For one, these centralized authorities could reverse transactions. They could also place arbitrary limits on how money is sent, and how much is sent, thereby completely controlling the financial system.
Finally, he explained that these authorities could be prone to error. While he didn’t explicitly name the Great Recession that was going on at the time, it was quite clear that the recession was one of the consequences of the centralized banking system.
In the second section, he described the technical nature of the blockchain. He defined it as a chain of digital signatures and went on to explain hashing, public keys, private keys, and timestamps.
In the third section, he wrote at length about the timestamp server, and in the fourth section he described the concept of proof-of-work.
In the fifth section, he went over the Bitcoin network and explained how it would guarantee transparency. According to Satoshi, the network had to broadcast transactions to keep the network accountable.
The sixth section covered mining and explained how miners would be rewarded with Bitcoin. He also explained how this would disincentivize hacking. The seventh section went over disk space, and Satoshi said that due to Moore’s law he didn’t expect any future problems with digital space.
The eighth section was about simplified payment verification, and the ninth covered combining and splitting value. The gist of the ninth section is that it’s better to not split bitcoin before sending it. Unfortunately, very few people have taken that advice.
The tenth and eleventh sections covered privacy and calculations, respectively. The last section was the conclusion, and in it, Satoshi writes that the Bitcoin network can never be defeated because it’s robust in its unstructured simplicity.
Bitcoin is yet to be hacked 12 years later, so Satoshi was correct. However, Satoshi has suffered a hack. Bitcoin.org, which was the first Bitcoin educational online source and was presumably registered by Satoshi himself, was hacked in 2021.
Why Did It Go Out on Halloween?
Now that you know that the paper went out on Halloween, you’re probably asking the billion-dollar question: why?
Satoshi And His Clues
There are 365 days in the year, and a vast majority of those days are ordinary. Why did Satoshi not choose to send the paper on any of those days? Is he, perhaps, trying to send us a message?
Since Satoshi was involved in the cryptography community, it would definitely not be beneath him to send a message that way. In fact, some analysts believe that his birthday itself is a secret message.
Satoshi is said to be born on April 5, 1975. Coincidentally, on April 5, 1933, Franklin Roosevelt signed an executive order banning the hoarding of gold. The ban came during the Great Depression, and it affected the ability of people to use gold as a safe asset to safeguard themselves from the inflation of paper currency.
Roosevelt passed the ban because gold was the US’s server currency, and the depression was causing people to hoard it. This was destroying the ability of the US to print money, so the bill was passed. It was, however, all for naught as the US abandoned the gold standard for currency the same year. But it wasn’t until December 31st, 1974, that people were allowed to hoard gold again.
What this clarifies is that 1975 was the first year since 1933 that people could keep gold. It also means that Satoshi was born in the first year that people were allowed to own gold. And Bitcoin, in this case, is digital gold.
Does that sound like a coincidence that’s simply too neat to be true?
Hal For Halloween
Hal Finney was a close internet associate of Satoshi, and both men first connected through the Metzdowd.com mailing list. They grew close, and Hal was the first recipient of Bitcoin, which was sent by Satoshi. And that’s where things get tricky.
Tech founders, or techies of any kind, really, generally do a first test transaction with themselves. The fact that Satoshi sent the first Bitcoin to Hal meant either of three things. It could mean that Satoshi was extraordinarily sure of himself and was certain his tech would work the first time of asking. It could also mean that Satoshi trusted Hal so much to send the first Bitcoin to him. And lastly, it could mean that Satoshi is Hal, and their internet friendship is merely a smokescreen.
The fact that Hal was the first person other than Satoshi to run the chain also adds fuel to the speculations that he’s Satoshi.
If Hal is indeed Satoshi, then sending the whitepaper on Halloween could make some sense. Hal could be telling us his name by sending the paper on Hal-loween. Cheeky? Yes. Possible? Also, yes.
It may look like a long shot, but this is Satoshi we’re talking about.
Bitcoin, The Ultimate Trick
Satoshi Nakamoto is perhaps the most popular anonymous person of this century. Despite no one knowing his face, name, or anything else really, he’s changed the world. For good or ill, Bitcoin is the most consequential invention of the last decade.
In a way, this anonymity extends to Bitcoin. It’s the perfect tool for people who would like to disappear and go off the radar. It’s the ultimate disguise tool.
While Halloween isn’t primarily a celebration marked by disguise, the use of costumes ends up making it precisely that. When people dress up on Halloween, they are trying to look like something else. They are trying to cloak their real selves and show something else to the public.
That is precisely what Bitcoin and the blockchain do to the financial system. Bitcoin cloaks your financial transactions and makes it impossible for you to be found out unless you want to be. If there were to be any currency that embodied the spirit of Halloween, it probably would be Bitcoin.
What Did People Think About The Paper?
There were only a few hundred people on the mailing list the paper was sent to, and most of the people on the list weren’t popular.
In essence, the paper was a flop. It flopped so badly that Satoshi had to resend the paper on November 3, 2008. Which was four days later.
When people did read the paper, many didn’t believe it would scale. They argued that it just wasn’t a big enough infrastructure for the volume of information that would be on it.
Of course, those early doubters were wrong. And many of them would rue the day they ignored Satoshi’s paper. If they hadn’t ignored him and poured cold water on his ideas, they could have been billionaires right now.
On the Flipside
- It may just be a coincidence that Satoshi released the paper on Halloween. He’d been writing the code for a few weeks before that point, and he was always going to send the paper when he was done with the Bitcoin code. That automatically means he couldn’t have sent it earlier than that date.
Why You Should Care
It’s Halloween, and it’s important to understand how the festivities may have inspired Satoshi Nakamoto to write the Bitcoin Whitepaper. It’s also a really good trivia question for Halloween games.