Elon Musk is a lot of things. Billionaire, space adventurer, transport revolutionary, but not, he says, the inventor of Bitcoin, the cryptocurrency coin that crossed the $10,000 valuation threshold early on Tuesday.
Musk, co-founder of PayPal, Tesla boss and CEO of Space Exploration Technologies, responded to a blogpost circulating on several crypto-currency sites claiming that he is Satoshi Nakamoto, the mysterious creator of bitcoin who has never been conclusively identified.
“Not true,” Musk said on Tuesday in a tweet. “A friend sent me part of a BTC [bitcoin] a few years, but I don’t know where it is.”
Musk was responding to a post on Medium last week in which writer Sahil Gupta floated the idea that based on Musk’s history of innovation across tech disciplines, his understanding of economics and cryptography and his coding abilities, it was possible that he was the author of the original document that proposed a peer-to-peer electronic cash system.
Bitcoin is a 'cryptocurrency' – a decentralised tradeable digital asset. Invented in 2008, you store your bitcoins in a digital wallet, and transactions are stored in a public ledger known as the bitcoin blockchain, which prevents the digital currency being double-spent.
Cryptocurrencies can be used to send transactions between two parties via the use of private and public keys. These transfers can be done with minimal processing cost, allowing users to avoid the fees charged by traditional financial institutions - as well as the oversight and regulation that entails. The lack of any central authority oversight is one of the attractions.
This means it has attracted a range of backers, from libertarian monetarists who enjoy the idea of a currency with no inflation and no central bank, to drug dealers who like the fact that it is hard (but not impossible) to trace a bitcoin transaction back to a physical person.
The exchange rate has been volatile, with some deeming it a risky investment. In January 2021 the UK's Financial Conduct Authority warned consumers they should be prepared to lose all their money if they invest in schemes promising high returns from digital currencies such as bitcoin.
In practice it has been far more important for the dark economy than it has for most legitimate uses. In November 2021 it hit a record high of more than $68,000, as a growing number of investors backed it as an alternative to other assets during the Covid crisis.
Bitcoin has been criticised for the vast energy reserves and associated carbon footprint of the system. New bitcoins are created by “mining” coins, which is done by using computers to carry out complex calculations. The more bitcoins that have been "mined", the longer it takes to mine new coin, and the more electricity is used in the process.
The speculation comes as Bitcoin’s astonishing rise in valuation is prompting new warnings of an asset bubble. Bitcoin’s value has surged more than tenfold this year and has jumped by 20% in the last three days alone. The total value of bitcoin in circulation now exceeds the stock market values of companies including Boeing, McDonald’s and Disney.
In his post, Gupta suggested that even if Musk is not the originator, the sector needs his expertise. Membership of Coinbase, one of the largest platforms for trading cryptocurrency, has almost tripled to 13 million in the past year.
“If Elon is Satoshi, it seems like this knowledge would become public at some point anyway. But if it were public now, Elon could offer guidance as the currency’s ‘founding father’.”
The dizzying surge in valuation is reportedly melting the resolve of cryptocurrencies’ fiercest critics.
In September, the JPMorgan CEO, Jamie Dimon, said if he found employees trading cryptocurrency, he would “fire them in a second, for two reasons: It is against our rules and they are stupid, and both are dangerous”.
Dimon is now said be considering systems to help clients trade contracts linked to the cryptocurrency.
Musk meanwhile is pressing ahead with efforts to revolutionize transport systems. His private space-launch company SpaceX, currently valued at $21.5bn, is ramping up its launch schedule of rockets that are able to take off, deliver a payload into space, then land back on a platform stationed in the Atlantic, to every two to three weeks.
In May, SpaceX laid out plans to put 4,425 satellites into space to provide global high-speed internet. The SpaceX CEO said he wants to land at least two cargo ships on Mars by 2022.
Musk’s more prosaic, earthly ambitions, also continue to unfold. Earlier this month, Musk unveiled Tesla’s first electric semi-truck.
With typical hyperbole, Musk vowed that the new truck would “blow your mind clear out of your skull and into an alternate dimension”.
The new vehicle, he claims, will reduce the overall cost to 20% less per mile compared with diesel trucks and boast faster acceleration, better uphill performance, a 500-mile (805km) range at maximum weight at highway speed, and “thermonuclear explosion-proof glass” in the windshield.
But the inventor of Bitcoin? Nope.
