Is Craig Wright Being Sued Over Non-Existent Bitcoins?

February 28, 2018

A WizSec blog post has described how the lawsuit facing Craig Wright is doomed to fail, basically because it paradoxically rests on a narrative supplied by the defendant, while at the same time discrediting that defendant’s honesty.

Craig Wright is an Australian cryptography expert and entrepreneur who claimed to be Satoshi Nakamoto back in 2016. Some believed him, most didn’t. David Kleiman was said by some to be the co-creator. The blog post was written by Kim Nilsson, co-founder of bitcoin security firm WizSec.

We reported yesterday that Wright is being sued by the estate of the late Kleiman, which is seeking between 550,000 and 1.1 million bitcoins, worth billions at today’s price. The suit claims that they were stolen by Wright from Kleiman following the latter’s death in 2013, via an elaborate scheme.

As with all things Bitcoin, the details are complicated, and the shady way that Wright behaved when revealing himself to be the creator of Bitcoin meant that not many believed him. The fact that one of the players in this suit has a number of question marks over his head even before any wrongdoing has been discussed adds another layer of confusion.

What is beyond doubt, however, is the fact that Wright and Kleiman were involved in Bitcoin in some capacity from the very beginning. As a result of this, the suit alleges: “It is undeniable…that Craig and Dave…both accumulated a vast wealth of bitcoins from 2009 through 2013.”

Nilsson, on the other hand, calls it a “nonsensical fight over unrelated funds that never belonged to either party”. He backs this up by showing the list of Bitcoin addresses used in evidence at the trial – he says that they are mostly not linked to either Wright or Kleiman, and in some cases they were created well after any window of relevance to this case.

The lawsuit claims that Wright took advantage of the fact that the grieving family did not know about Kleiman’s involvement with Bitcoin and stole hundreds of thousands of bitcoins from his former partner by backdating contracts and forging Kleiman’s signature:

“Since fleeing to London, Craig has lived a life of fame and fortune. In May 2016, he publicly revealed himself as the alleged creator of Bitcoin…He also regularly posts pictures to his social media accounts of his lavish lifestyle. To date, Craig has not returned any of the mined bitcoins or intellectual property rights belonging to Dave’s estate. This action is brought to rectify that injustice.”

Nilsson points out that the lawsuit is based on the assumption that Wright, as he claims, created Bitcoin along with Kleiman. It argues that if Wright is so untrustworthy (and it lists a number of underhand financial dealings as evidence to support this assertion), how can we be certain that this is true? He says: “…it’s some guy browsing a “blockchain rich list”, picking out a couple of addresses at random and saying “I own those” for whatever reasons, while offering no evidence except for some clumsy document backdating. These claims would never have gotten past an actual specialist.”


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