The Secret Life

by Andrew O'Hagan

  Wright’s emails to Kleiman suggest that by this point he was starting to mine the million or so bitcoins that are said to be owned by Satoshi Nakamoto. ‘I have a few potential clients in gaming and banking,’ he wrote to Kleiman. ‘I figure I can work ten to 15 hours a week and pretend to have a consultancy and use this to build and buy the machines I need. If I automate the code and monitoring, I can double the productivity and still offer more than others are doing … The racks are in place in Bagnoo and Lisarow. I figure we can have 100 cores a month setup and get to around 500.’

  Kleiman replied the same day to affirm their vows. ‘Craig, you always know I am there for you. You changed the paradigm that was held for over a decade and destroyed the work of a couple academics. Do you really think they will just take this happily? I know you will not, but try not to take the comments to heart. Let the paper speak for itself. Next time you need to get me a copy of the conference proceedings as well. You know it is not easy for me to travel.’ A picture emerges of an ailing Kleiman sitting at his computer day and night in his small ranch-style house in Riviera Beach, Florida. After writing this last email, he spent a frighteningly long period in hospital. The two men agreed to meet up at a conference in Florida on 11 March 2009 and Kleiman wrote expressing his excitement at the prospect of a few beers with Wright. Craig and Lynn stayed at Disney’s Coronado Springs Resort Hotel, and Kleiman drove there in his customised van, rolling into the bar with a big smile: Kleiman was the brother and drinking buddy and like-minded computer nerd Wright had never had. Not even Lynn had a clue what they were talking about.

  During my visit to Australia I met Lynn in Chatswood, on Sydney’s north shore, a busy commercial district that heaves with eager shoppers on a Saturday morning. She had met Wright on the internet while she was working as the nursing manager of the ICU in a military hospital in Ottawa. She told me Wright asked her to marry him about six weeks after they met online. When she eventually went to Sydney to visit him, he brought a ring to the airport. ‘He was twenty-six and I was forty-four,’ she said. Neither of them had been married before.

  ‘He was very mature for twenty-six,’ Lynn told me. ‘He always has to be the best. And the hard part about that is he left bodies by the wayside. He stepped on people.’ She began working for him – ‘he was the geek and I was the gofer’ – and he got a lot of work in information security, working for the Australian Securities Exchange and for Centrebet, which was where he first got to know Stefan Matthews. Wright told me he was afraid some of the things he did for those online betting companies would come back to bite him, if and when he was outed as Satoshi. Other sources told me that he and Kleiman had had some involvement with illegal gambling. ‘I knew Dave Kleiman and he were working together,’ Lynn told me, ‘and I remember them saying that digital money was the way of the future. I’ve never said this to anybody, but I knew he was working on it and I didn’t ask, because I knew he would bite my head off if I didn’t understand it. He’s got a very sociopathic personality.’

  Lynn said her husband had admired Kleiman. And she admired him too: ‘He loved life,’ she said, ‘and he had a brilliant mind, like Craig, but he had a gentler soul.’ She remembered the Orlando conference. ‘We stayed in a hotel that looked like a giant cartoon,’ she told me. ‘We met in one of the bars. He was a young guy, in his thirties or early forties, brown hair and moustache, average-looking. And boy, he loved to have a good time. It might have been his birthday. I went into the Disney store and bought some hats – Craig had Pluto, and Dave had one in the shape of a giant birthday cake.’ Wright stepped out of himself for Kleiman: ‘I’d never seen him like that with anybody. It was like, “I wanna grow up to be just like him.” Dave softened Craig. A lot of what they wrote together was in his voice. I’d never seen Craig react like that to anybody. When he felt unsure of himself he went and talked to Dave. I think he wanted to be like Dave, but he knew he couldn’t be.’

  ‘In terms of having that kind of temperament?’

  ‘Yeah. Dave was good for him. It made him realise that life doesn’t go your way all of the time.’

  I asked her if she thought Craig was a flawed person. ‘Yes,’ she said. ‘He’s starting to realise it. He knows he’s done well in his work but he hasn’t done well as a human being.’ She stared into her cup. ‘When we were at the farm,’ she said, ‘I was interested in finding four-leaf clovers. I would never find any, but Craig would just step out of the house and find three.’

  In mid-2011 Satoshi suddenly disappeared from view. Apart from one or two emails denouncing fake Satoshis, he wasn’t heard from again. Control of the network alert key is said to have been passed at this time to Andresen – possession of this key makes its holder the closest thing bitcoin has to a chief. Wright sent Kleiman an email on 10 September 2011: ‘It is recorded. I cannot do the Satoshi bit any more. They no longer listen. I am better as a myth. Back to my lectures and rants that everyone ignores as me. I hate this Dave, my pseudonym is more popular than I can ever hope to be.’

  For some reason – possibly fear of the ATO – Wright set up a trust fund called the Tulip Trust in June 2011, and asked Kleiman to sign an agreement stating that he, Kleiman, would hold 1,100,111 bitcoins (then valued at £100,000, currently worth around $800 million). For clarity: there is no evidence that Kleiman ever took custody of that amount. However, there was a separate agreement that Kleiman would receive 350,000 bitcoins and this transaction was made. ‘All bitcoin will be returned to Dr Wright on 1 January 2020,’ it says in the trust document.

  No record of this arrangement will be made public at any time … Dr Wright MAY request a loan of bitcoin for the following reasons (and no others): Furthering research into peer to peer systems … commercial activities that enhance the value and position of bitcoin. In all events, all transactions in loaned funds will be concluded outside of Australia and the USA until and unless a clear and acceptable path to the recognition of bitcoin as currency has occurred … I lastly acknowledge that I will not divulge the identity of the Key with ID C941FE6D nor of the origins of the satoshin@gmx.com email.

  Kleiman signed it. ‘I think you are mad and this is risky,’ he wrote in an email to Wright on 24 June 2011, perhaps spying a possible illegality. ‘But I believe in what we are trying to do.’ Wright meanwhile seemed to get more and more frustrated. He both wanted fame and repudiated it, craving the recognition he felt was his due while claiming his only wish was to get back to his desk. ‘I have people who love my secret identity and hate me,’ he wrote to Kleiman on 23 October that year. ‘I have hundreds of papers. Satoshi has one. Nothing, just one bloody paper and I cannot associate myself with ME! I am tired of all these dicks Dave. Tired of academic attacks. Tired of tax fuckwits. Tired of having to do shenanigans like moving stuff overseas IN CASE it works.’

  I came to feel that there were secrets between Wright and Kleiman that might never be revealed. Wright usually clammed up when asked about Kleiman and money. One day, in a fit of high spirits, he showed me a piece of software he said that US Homeland Security had ripped off from him and Kleiman. He smiled when I asked if they’d done government security work. The first thing most people ask about when you mention Satoshi is his alleged bitcoin hoard: he invented the thing, and created the Genesis block, and mined bitcoins from the start, so where was Wright’s money and where was Kleiman’s? The emails, when I got them, seemed to clear this up slightly, but, during many dozens of hours of conversation with Wright, he never properly told me how many bitcoins he mined. (Mining, by the way, creates no real-world benefit. It is simply the process by which computers are set, by the miners, to burn up energy solving maths problems, in order to gain a ‘reward’ with a designated ‘value’, one bitcoin.) I was aware – and he knew I was aware, because I told him several times – that he wasn’t giving me a full account of everything that had occurred between him and Kleiman. He said it was complicated.

  Somewhat more helpful are minutes taken during a meeting between
the ATO and representatives from Wright’s Australian companies in Sydney on 26 February 2014. According to the minutes, Wright’s representative John Cheshire went into detail about the financial collaboration between Wright and Kleiman. This was a story that Wright, for some reason, didn’t want to tell me. Cheshire said that Wright and Kleiman had set up a company called W&K Info Defense LLC (W&K), ‘an entity created for the purpose of mining bitcoins’. Some of these bitcoins were put into a Seychelles trust and some into one in Singapore. Wright, according to Cheshire, ‘had gotten approximately 1.1 million bitcoins. There was a point in time when he had around 10 per cent of all the bitcoins out there. Mr Kleiman would have had a similar amount.’

  I asked Wright about this and he told me it was true that his and Kleiman’s mining activity had led to a complicated trust. The trust question was persistently vague: not only how many trusts but the names of the trustees and the dates of their formation. The only consistent thing is the number of bitcoins Wright is said to have had at one time, 1.1 million. He said that these holdings could not now be moved without the agreement of the (several) trustees. He also said that Kleiman had been given 350,000 bitcoins but had not moved them. He kept them on a personal hard drive.

  Wright also set up a shell company in the UK. ‘I know what you want and I know how impatient you can be,’ Kleiman wrote on 10 December 2012, ‘but really, we need to do this right. If you fail you can start again. That is the real beauty of what you have.’ It’s possible Kleiman was referring to their ability to mine bitcoins and then squirrel them away. But he was evidently worried about Wright’s ability to cope with all the flak, and about Wright’s kamikaze attitude to the tax authorities. ‘I love you like a brother Craig,’ he added, ‘but you are a really difficult person to be close to. You need people. Stop pushing them away. You have over one million bitcoin now in the trust. Start doing something for yourself and this family you have.’

  Around this time, an eighteen-year-old IT enthusiast called Uyen Nguyen began working with them. Very quickly, Kleiman made her a co-director of their company and she later became a powerful figure in the trust. It’s unclear how such a young and inexperienced person came to have so much influence. Wright told me she was ‘volatile, capricious and beyond control’. He added that Kleiman liked young women and that she was loyal and trusted – but that ‘she wants to help and this always leads to trouble.’ While I was preparing this story, Wright began to seem worried about Nguyen. I always felt he was in the middle of a very complicated lie when he talked about her. ‘My way of lying’, he told me one day, ‘is to let you believe something. If you stop questioning and then you go off, and I don’t correct you – that’s my lie.’

  Towards the end of 2012, Dave began to fail. ‘Paraplegics get sick a lot,’ Lynn Wright had told me, speaking as a nurse. ‘The bedsores get bad and they can’t fight infections. Dave was in and out of hospital a lot and I don’t know what his life was really like.’ Wright told me that Kleiman had girlfriends, but admitted he didn’t really know much about his life. Like Wright and his first wife, they had met in a chatroom. They met in the flesh no more than half a dozen times. Kleiman seems to have lived in front of his computer day and night, and the sicker he got the more isolated he seemed to be. Just after 6 p.m. on 27 April 2013 he was found dead by a friend who’d been trying to contact him for several days. He was sitting in his wheelchair and leaning to the left with his head resting on his hand. Lying next to him on the bed were a .45 calibre semi-automatic handgun, a bottle of whisky and a loaded magazine of bullets. In the mattress a few feet from where he sat, a bullet hole was found, but Kleiman had died from coronary heart disease. There were prescription medicines in his bloodstream and a modest amount of cocaine.

  ‘We never really thought that “we made Satoshi”,’ Wright told me once. ‘It was good. It was done. It was cool. But I don’t think we realised how big it would be.’

  ‘There was no conversation between you about how it was going over? That Satoshi was becoming a guru?’

  ‘We thought it was funny.’

  Wright paused, shook his head, and broke down. ‘I loved Dave,’ he said. ‘I would have seen him more. I would have talked to him more. I would’ve made sure he had some fucking money to go to a decent hospital. I don’t think he had the right to choose not to tell me.’

  ‘What was happening to him?’

  ‘Neither of us had any money, physical money. We had money in Liberty, an exchange in Costa Rica, but the Americans closed it down as a money-laundering operation. Dave had a number of bitcoins on the hard drive he carried with him. Probably about 350,000.’

  ‘Hoping it would …’

  ‘As I said, it wasn’t worth that much then. Dave died a week before the value went up by twenty-five times.’ Wright kept wiping his eyes and shaking his head. He emphasised something he said the commentators never understood: for a long time, bitcoin wasn’t worth anything, and they constantly needed money to keep the whole operation going. They feared that dumping their bitcoin hoard would have flooded the market and devalued the currency. One of the things Wright and Kleiman had in common is that they had a problem turning their ideas into cash and were always being chased by creditors. Kleiman died feeling like a failure. No one in his family has the passwords to release the bitcoins on his computer. After he died, his family didn’t open probate on his estate because they believed it had no value. Kleiman’s supposed personal bitcoin holdings are worth $260 million at today’s prices.

  The London Office

  No one in London seemed too bothered by the earlier rubbishing of Craig Wright. The computer technology world had dismissed him after the Wired ‘outing’ of him in December 2015, but Wright and the company just marched on, with the help of an expensive PR company, preparing for the big reveal that would prove the naysayers wrong. The company behind the deal, nCrypt, were investing more and more in Wright at this point, and they were desperate for the story that I kept saying wasn’t close to being ready. It required absolute proof, and not even they, by their own admission, had quite seen that yet. But they continued to build him. In January 2016, on a rainy London afternoon, Wright took me to see the large office that was being set up for him as part of the deal with nCrypt. It hadn’t taken long for the world to forget that they’d once thought Wright was Satoshi. One or two of the media organisations that had ‘outed’ him in December had taken down the original articles from their websites, stung by the cries of fraud. After only a few days’ interest in the notion, most people had made up their minds that Wright had nothing to do with Satoshi. Wright – under strict advisement – had said nothing in response to the media reports accusing him of perpetrating a hoax, but when we were alone, which was most of the time, he would launch into point-by-point rebuttals of what his critics had been saying. In the end he would shrug, as if obscure things were actually obvious.

  The press coverage of Wright and Wright himself had something in common: they succeeded in making him seem less plausible than he actually was, and, to me, that is a general truth about computer geeks. They are content to know what they know and not to explain it. They will answer a straightforward slur with an algorithm, or fail to claim credit for something big then spend all night trying to claim credit for something small. Many of the accusations of lying that were thrown at Wright that December were thrown by other coders. And that’s what they’re like – see Reddit, or any of the bitcoin forums. Much of what these people do they do in the dark, beyond scrutiny, and, just as it’s against their nature to incriminate themselves, it is equally unnatural for them, even under pressure, to de-incriminate themselves. They just shrug.

  Coders call one another liars, when all they really mean is that they disagree about how software should work. During the time I was working with Wright in secret, I would text my colleague John Lanchester, who I knew I could trust to keep the secret but also to understand what was at stake in the story. ‘Imagine a situation’, I wrote to John,
‘where novelists were strangely invested in denying the plausibility of each other’s books. There’s no “proof” as such that one is right and the other is wrong, but they could argue fiercely and accuse each other of all sorts of things while not really settling the problem.’

  ‘Edmund Wilson says somewhere that the reason poets dislike each other’s books is because they seem wrong, false – a kind of lie,’ John replied. ‘If you were telling the truth you would be writing the same poems as me.’

  So the world that Wright knew best thought he was a liar. And the day we visited his new offices he seemed resigned to the fact. Much later, he told me that these months were the high point of his career in computer science: he was working in secret on material that seemed to be coming together beautifully and profitably. It irked him that people called him a fraud, and it irked him just as much that his deal with nCrypt would require him to prove that he was Satoshi. He hated being accused of being a fraud and he hated having to prove that he wasn’t a fraud. Having it both ways is a life, a life that requires a certain courage as well as shamelessness, and Wright was living his double life to the hilt.

  Wright introduced me to Allan Pedersen, who’d been his project manager in Sydney. We were in the Workshop – a floor above MacGregor’s office near Oxford Circus – standing at a glass workbench beside a whiteboard covered in writing. The opposite wall was stencilled with a quote from Henry Ford: ‘Whether you think you can or think you can’t, you are right.’ Pedersen told me he had been brought over to direct a group preparing an initial batch of thirty-two patent applications, to be completed by April 2016. (This was in January of that year.) Beyond that there were ‘upwards of four hundred patents’, ideas to do with using the blockchain to set up contracts that would come into action on specified dates years ahead, or using the blockchain to allow cars to tell their owners when they needed petrol and to debit the cost when they refuelled. At this point, and for several minutes afterwards, Wright spoke of himself in the third person. ‘Craig has been given a big kick up the bum,’ he said, ‘because Craig, instead of doing tons of research and sticking it on a shelf, has to complete it and turn it into something.’