May 8, 2019

Kleiman v Craig Wright, part 2

As part of the ongoing lawsuit against Craig Wright by the relatives of Dave Kleiman and in response to a court order to reveal details of Wright's supposed bitcoin holdings (including a long hinted-at blind trust), a filing about Wright's supposed bitcoin holdings was recently unsealed. While the bitcoin addresses contained within are redacted, it turns out they're not hard to guess.


Craig Wright has for years claimed to be Satoshi Nakamoto, the unknown inventor of Bitcoin, through a complicated web of stories where it seems every piece of supposed corroborating evidence exposed to public scrutiny ends up being shown to be fraudulent in some way. To date, no one has moved any of Satoshi's bitcoins or signed any messages with his private keys since he disappeared.

None of this seems to deter Wright's fans who follow his "Satoshi's Vision" (SV) fork of Bitcoin, to whom Wright's angry technobabble speeches are just evidence of a genius playing 4D chess with his hopelessly wayward opponents.

Part of Wright's long-running backstory is that he supposedly invented Bitcoin together with Dave Kleiman, and that together they mined large amounts of bitcoin that were later put into a blind trust (to which Wright will regain access in 2020). People have speculated that Wright may have made most or all of this up as a way to explain where large amounts of money he received as tax credits went — the subject of an Australian Tax Office investigation targeting Wright until he fled Australia — but that these days the claim to be Satoshi Nakamoto serves merely as a means of profiting from believers.

In an ironic twist, the Kleiman family is now suing Craig Wright for Kleiman's share of the massive bitcoin holdings Wright claims came out of their efforts, on the logic that since the Kleimans have never seen any bitcoins, Wright must have them. (Dave Kleiman himself passed away in 2013, prior to any of Wright's public claims.) In reality, we have no reason to believe any such bitcoins exist, or that Wright or Kleiman had any involvement at all in Bitcoin's development, other than Wright's own unsubstantiated claims.

A previous post on this blog took apart an earlier list of supposed bitcoin holdings of Wright or his secretive trust, where the claimed addresses seemed to have been simply random addresses with large holdings, without any proof of ownership, and where many addresses could easily be shown to actually belong to other people.

The lawsuit so far

Anyone can follow most of the developments in this lawsuit by reading the court docket, which is already quite long since the case began last year. Wright submitted what appeared to be forged evidence (only to hastily withdraw it after the forgery was discovered), has angrily refused to testify on certain topics while calling the plaintiff a "con man", and has argued that producing any information about his bitcoin holdings would be "unduly burdensome".

Most recently, the judge sided with the Kleimans and ordered Wright to produce detailed information about his past bitcoin holdings as well as information about the supposed blind trust. As part of this, a previous filing of some of the bitcoin addresses Wright claims to own was unsealed, in which Wright says that he doesn't remember his addresses but since he mined bitcoins he can just look up addresses from the block rewards on the blockchain. He then supplies a list of 70 redacted addresses.

I chat with a lot of people about various bitcoin topics, especially involving analysis or detective work. In this case I was tipped off by Greg Maxwell about the unsealed document, and we were chatting and speculating that it sounded like Wright just scraped the blockchain for early block reward beneficiaries and claimed those. Well, we dug a bit deeper and it looks like that guess was correct in the most literal way possible.

Take the list of the first 70 block reward addresses (excluding the Genesis block) and they line up perfectly with Wright's redacted list. We can even make educated guesses for the other redacted text by typing up candidate text in a word processor with matched formatting and checking whether it lines up with the original document:

(candidate text overlaid in red over original pages)

Update: Turns out the PDF also contains stray metadata (orphaned URL annotations) for the last 45 addresses, which at some point during editing were probably hyperlinks to which the redaction process didn't strip out from the PDF. This allows us be very confident that our guess is correct. (Kudos to Satoshi Itches who first posted about this.)

So what does this mean? Well, first of all, this is presumably the earlier list of addresses that the Kleimans and the judge were unsatisfied with, and it's not hard to see why. What ought to be trivial to demonstrate, Wright seems to consistently avoid with evasive and absurd excuses, like suggesting that the way you store and manage your keys/addresses is to memorize and remember them. (That's what wallets are for, precisely so you never forget or lose your keys).

What Wright does provide appears to be just a lazy copy-paste from the blockchain, without any cryptographic signatures to support his claims of ownership. It beggars belief, to say the least, for the self-proclaimed inventor of Bitcoin to act so ignorant about the fundamentals of his invention. Perhaps Wright thinks that being a bitcoin miner means pointing at bitcoins and yelling "Mine!"?