Sleeping beauty Bitcoin wallets wake up after 14 years to the tune of $2B

> what are the odds that someone has been quietly spending 10s/100s of millions in cloud compute to brute force the keys for old wallets?

Even if that were possible, you could brute force one wallet. Not eight wallets closely related to each other.

Keys created with an RNG that turned out to be a little too predictable?

Or some other flaw found in a wallet’s key generation?

Kinda like what happened here: https://news.ycombinator.com/item?id=6195493

(Or exactly that but nobody tried to attack this again with moar power?)

One of my students believes Elon Musk and Peter Thiel created Bitcoin. Here's the summary of the 5 page doc he presented:

In 2000, according to Peter Thiel, he met with the E-Gold team in Anguilla.

Around 2001, Elon and Peter were at PayPal, and they had plans to build a similar digital currency.

In 2002, PayPal was sold, and that pretty much ended the digital currency plan. Instead, PayPal let users link their bank accounts and cards to make payments. This created a bigger dependency on banks.

By 2004, there were over a million E‑Gold accounts. Banks weren’t happy about it. Meanwhile, Elon and Peter understood exactly how much potential this new kind of digital currency had.

In 2007, the banks took the founders of E-Gold to court for running an unlicensed money‑transmitting business. That same year, the E-Gold engineers were out of work.

Bitcoin was invented in 2008, the same year Elon was broke and busy trying to save both SpaceX and Tesla from going bankrupt.

His theory is that Elon and Peter hired the smartest engineers from the E-Gold team and asked them to build blockchain so they could create their own version of E-Gold. The team worked on Bitcoin from 2007 to 2010 under the alias of Nakamoto.

> Around 2001, Elon and Peter were at PayPal, and they had plans to build a similar digital currency.

> In 2002, PayPal was sold, and that pretty much ended the digital currency plan. Instead, PayPal let users link their bank accounts and cards to make payments. This created a bigger dependency on banks.

This doesn't hold up to scrutiny.

Except PayPal wasn't invented by Elon or Peter. It was Elon's company's plan to build the digital bank but they were failing quite spectacularly at it.

They merged with Confinity who'd already built PayPal, had a working prototype, etc.

Elon lasted four months as CEO of PayPal, trying to convert it from Java to ASP until the Board didn't ask him to resign, but fired him, the morning he left on his honeymoon after getting married.

PayPal is a complete red herring there. Elon had no participation in ideas on digital currency there.

Perhaps plausible until you mention that they hired a team to build it.

There's no way, even if it was a single-digit number of people team that they would remain silent. If it was just Elon/Thiel I could perhaps believe it.

Also keep in mind that there were some very desperate years for Elon where his companies were extremely close to bankruptcy, wouldn't he have tapped into that bitcoin if he had access to it?

My counterpoint is that if Elon were involved in any way at all, he would have taken credit for it publicly by now.

> closely related to each other.

Like, sequential? Because if you were brute forcing...

I do not think that Elon would not claim he is the inventor by now. The team theory makes this entirely unbelievable. Something like this can only be pulled of by 1-2 person's whith exceptional self-restraint.

It was jack.

It’s quantum computer.

Fun personal fact - the only reason I didn't invest more in Bitcoin (which would have definitely been enough to be FU money) was because I had some E-Gold when it was shut down.

> They merged with Confinity who'd already built PayPal, had a working prototype, etc.

Interesting, need to read about it. So similar story as with Tesla? Existing opinion nicely confirmed.

Because Elon is so humble…

Seems fairly humble to me in that he's always thanking the team and giving them most of the credit.

Worse fun personal fact. I was planning to buy 5000 bitcoins on a Friday after work. A coworker convinced me and it made sense. Bitcoin was less than 2 a coin at that point.

Then I go down the elevator in my building and there is a huge crowd of people. It ended up being 50 cent the rapper and a few other famous people.

It was so surreal and unexpected I completely forgot about Bitcoin for a few months. And by then I could stand the fact it had tripled (or something) and I had missed it.

Would have been hundreds of millions. Could have lost the hdd or had sold later but I'd always hold some.

Lol so now I blame 50 cent that I didn't buy Bitcoin

I've got a Confinity Paypal tshirt from a job fair I went to in 2000 or 2001 from back when they envisioned people using palm pilots to transfer money. I always think it's hilarious that people give Elon any credit for doing anything at the company.

You would’ve sold it way before it became FU money

If this at least involved Len Sassaman somehow, I'd find it at least worthy of digging in to this. Pass. Musk and Thiel being true cypherpunks? Come on. Musk hasn't had a single idea on his own, Thiel is way too busy coming up with ways to enslave everyone. No way they had anything to do with creating Bitcoin.

Any team involved would have long ago spilled the beans.

Conspiracies are impossible to maintain, once more than one or two people are involved.

Peter Thiel said in one of his podcast he believes it was the E-Gold team who created Bitcoin under the alias of Nakamoto. He also confirmed he knew the team. But no one knows the names of the engineers or who financed them.

All we know is that Elon and Peter revolutionised the finance industry with PayPal.

Indeed. That's what so many miss.

One of the doge creators sold all his early doge for a used car. He'd hit the jackpot, a $5k return on something he rolled out in under a day's work, for fun.

He didn't make the wrong decision. All his coin was worth 5 bucks, then 5900. What would you do?

Yeah - assuming this was not the rightful owner (which it might well be), my gut is that perhaps someone found an implementation flaw/quirk in some old wallet code/keygen/RNG that effectively reduced the keysize down to something more manageable for brute-forcing. In ye olden days Bitcoin was still something of a curio for geeks and nerds and not the industry it is now, so it would not be unreasonable IMO for there to be some slightly-less-than-perfect implementations floating around from hobbyists or open source etc - the stakes were lower then.

If there was say a vulnerability in a specific wallet version it would be quite possible to narrow down search space to only the wallets/addresses around that point in time etc as well, making it easier to target your brute-forcing efforts.

It will be interesting to see if any other dormant wallets from around the same era wake up too.

Better odds: old man theory.

Some dude had the wallets on a usb drive. Maybe he mined in the very early days, never really thought of it, and ended up aged and not cognitively aware, his memory wonky.

Recently, he just passed on.

His offspring cleaned out his garage or whatever, found a usb stick, looked on it for photos, and found this.

> wouldn't he have tapped into that bitcoin if he had access to it?

That's not how business works. You borrow, then borrow some more, and focus on having a long term plan to cover the interest, so you don't upset the banks or end up broke again.

Doesn't Elon sell Bitcoin whenever he needs a few hundred million these days?

The fact that we don't understand how someone could've come up with something like PayPal or Bitcoin might be exactly why Elon and Peter are the richest people on the planet.

> There's no way, even if it was a single-digit number of people team that they would remain silent.

JPMorgan moves $10 trillion a day. Would you sleep at night knowing you publicly admitted being involved in a project whose only mission is to bring them down?

JPMorgan moves $10 trillion a day, according to Jamie Dimon. So there's the unwritten rule: you never upset the banks because that's the last thing you'll ever do.

So why would the richest person on earth do that? He's not crazy.

Video where he said he knew the team? In the main video, he just speculates that some people at the conference made bitcoin. Never provided even a claim to having evidence.

The definition of humility is not "doing the bare minimum."

Some of the history between the two companies is covered in a book, "Paypal Wars.[0]

Among other things it happens to spotlight Musk's fascination with having "X" as the company name, especially for a bank.

0: https://en.wikipedia.org/wiki/The_PayPal_Wars

Nick Szabo, Hal Finney, Peter Todd, and Adam Back were definitely part of the team after the paper was published. But Len Sassaman? I don't think so.

> Musk and Thiel being true cypherpunks?

Even cypherpunks had bills to pay.

And who was hiring in 2007? The same people who disrupted the banking and oil industry with PayPal and Tesla.

So you are contradicting what Luke Nosek, the co-founder of PayPal, said?

Luke: "Many people don’t know this, but the initial mission of PayPal was to create a global currency that was independent of interference by these, you know, corrupt cartels of banks and governments that were debasing their currencies.”

Why should we believe you and not the person who created PayPal?

https://finance.yahoo.com/news/paypal-originally-aimed-creat...

The people who give him credit are the same people who sold PayPal for $1.5 billion in July 2002:

Peter Thiel, Max Levchin, Luke Nosek, Reid Hoffman, David Sacks, Ken Howery, Jeremy Stoppelman, Russel Simmons.

Elon was removed as CEO in 2000, but he remained the largest individual shareholder when PayPal went public.

You've just created an account to ask that question? Wow :D

https://kqmarkets.co.uk/article/did-peter-thiel-meet-satoshi...

https://protos.com/is-peter-thiel-inner-circle-behind-the-sa...

https://www.bloomberg.com/news/articles/2021-10-21/peter-thi...

"Peter Thiel met with the e-gold team in February 2000 on the Caribbean island of Anguilla to discuss making PayPal interoperable with e-gold. The goal was to challenge central banks by creating a system where PayPal and e-gold could work together. Thiel believed this collaboration could spark a revolution against traditional financial institutions."

Actions speak louder than words.

- Thiel met with digital currency pioneers in 2000.

- Thiel chose not to partner with E-Gold because he needed to stay compliant and bank-friendly.

- A few years later, Bitcoin quietly appears, solving the exact problems E-Gold ran into.

- No names. No funding trail. No way for banks to know who the enemy is. Just Bitcoin wallets full of money.

It doesn't sound like a bunch of idealistic cypherpunks building tech to save the world. It sounds like a few smart, well-connected people who understood how money moves, got frustrated with the banking system and their fees, and built a way to create wealth and move value without paying commissions.

The cypherpunks laid the groundwork for the encryption banks, governments, and corporations now depend on. They were never interested in dodging taxes or avoiding bank fees.

Back in the real world, plenty of people publicly associated with running major cryptocurrencies (and Craig Wright!) are walking around talking about how they invented the cryptocurrency and how it revolutionises banking, and plenty of people inventing infrastructure for promoting Bitcoin are doing deals with banks, whilst Elon is the sort of guy who goes to extreme lengths to piss off both political parties in the country that he and his businesses and his lucrative government contracts are based in, including ranting into the void about the most powerful and most sensitive man in the Western world is in the Epstein files when they had a fallout...

Len went on for years about what a stupid idea Bitcoin was.

I saw people using PalmPilots to transfer money on PayPal in 02001.

Except for the secrecy of Colossus, Crypto AG, the 9/11 hijackings, Bill Cosby drugging and raping dozens of women, Peter Thiel funding lawsuits against Gawker, the Manhattan Project, the CIA-funded coup against Mossadegh, Stuxnet, the Five Families, most of what the NSA does, the Stealth Bomber, and so on.

Almost all of those remained secret longer than the 17 years we're talking about here, and due to selection bias, I am forced to omit the much more successfully kept secrets, because I don't know about them yet.

Just applying Occams Razor here, this whole story makes more sense if the E-Gold engineers just bootstrapped this project without Musk/Thiel involvement.

E-Golds most talented 1-2 engineers weren’t poor people, and could definitely afford a 5 year career break.

People always forget about the great Wei Dai, who like Nakamoto is already sort of pseudonymous, he also created Bmoney which is allot like Bitcoin. He is also the creator of the Crypto++ cryptography library for C++ (bitcoin is written in C++) From all the OG Cypherpunks he ticks allot of the boxes.

> So there's the unwritten rule: you never upset the banks because that's the last thing you'll ever do.

What are they going to do? Whack him mafia style and make it look like an accident? Here’s a more realistic rule: “If you owe the bank $100, that's your problem. If you owe the bank $100 million, that's the bank's problem”.

https://www.goodreads.com/quotes/214064-if-you-owe-the-bank-...

> So why would the richest person on earth do that? He's not crazy.

You mean the guy who is so insecure he constantly lies, even about the most inconsequential things…

https://archive.ph/20250127023632/https://www.nytimes.com/20...

The guy who is so uninformed and gullible he falls for any conspiracy theory…

https://www.techdirt.com/2024/10/25/lies-damned-lies-and-elo...

https://www.youtube.com/watch?v=3u8_fp1TtJE

The guy who jeopardised billions by buying into a random tweet accusing a business partner without proof…

https://voz.us/en/world/250308/21932/mexican-tycoon-carlos-s...

The guy who invested all his time and energy electing someone like him, only to then (predictably) have a falling out…

https://en.wikipedia.org/wiki/Trump%E2%80%93Musk_feud

I mean, maybe he isn’t crazy, but that isn’t really an effective defense. Crazy people at least have an excuse.

I doubt it, Ive held my Tesla shares since the beginning.

Can you name me a self made billionaire who is more humble?

This is the dumbest idea I ever hear smart people say.

Uhhh... nothing I said contradicts Luke Nosek.

Elon was working on a digital bank, not a global currency. His company was failing miserably.

Confinity, who made PayPal, and had a first version working, merged with them.

Elon gets no credit for a 'global currency' idea (nor do I think he and Thiel invented Bitcoin[1]), because Confinity was already working on that idea when they merged and became PayPal properly, in the four months before he was ousted.

My argument was that Elon wasn't all about the global currency.

[1] And Elon definitely didn't invent BitCoin. His ego would never permit him to have kept that a secret for a month, let alone a decade plus.

The selection bias, is discounting the endless conspiracies exposed daily.

People go to jail, are caught out, fired, relationships break up, governments fall, because conspiracies of even a few people fall apart. It's a regular thing.

You're mentioning some things, of which some were known during the time. The FBI had reports of the 9/11 hijackers, Bill Cosby was known by many but the women were paid off with cash or jobs (until they rightfully went public), and things such as the CIA and the Manhattan project are laced with highly patriotic people, and the death penalty or life in jail, along with people sequestered and watched by immense security.

Secrets are very difficult to keep.

The things you think of were enormously unusual in that they were kept.

They were the exception to the rule.

Very plausibly the identity of Satoshi is already known to more people than Cosby's rapes or the 9/11 hijacking plans, before everybody knew about them. The hijacking plans weren't even well-known inside the FBI! And it's also very plausible that the people involved in Bitcoin were either strongly idealistic, facing death penalties for disclosure (for example, if they work for the Mossad), or both.

I agree with your weakened claim that secrets are very difficult to keep, but much of modern society is built on institutions that are very good at keeping them: armies, intelligence agencies, and even companies with trade secrets.

I agree that Satoshi was probably just one or two people, and the difficulty in keeping secrets with more than a few people is one of my reasons for that. But you said it was impossible, not difficult, which is much too extreme to be justifiable.

(I think it's about 50% likely that it's one of a couple of dozen people I've met personally, but I wouldn't be able to convince anyone else. So you might be talking to one of the people in the position of Bill Cosby's friends before the news came out.)

Context matters.

The PayPal mafia (Musk, Nossk, Thiel, Levchin, Sacks, and the rest) spent years working closely, obsessing over banks, money, payments, and how to move value on the internet, questioning everything: What is money? Who controls it? How do you make it more efficient, global, and digital?

True. Nothing gets built in isolation. Bitcoin was the result of decades of work by cryptographers, economists, investors, and engineers

Agree. He was not impressed with Bitcoin

Yup. Also explains why X is trying to move into payments now.

Elon seems to need to finish a vision he didn't get a chance to finish back then.