“Chancellor Nash” by @ormpho

19 Reasons John F Nash Jr. was Satoshi Nakamoto

Jon Gulson
10 min readNov 12, 2020


It is Bitcoin folklore that Hal Finney was party to the first transaction on 12 January 2009 with creator Satoshi Nakamoto, a pseudonym for person or persons unknown.

One of the usual suspects for the identity of Satoshi Nakamoto is Adam Back, because Bitcoin describes itself as a proof of work system similar to Back’s Hashcash.

However, Back denies he is Satoshi Nakamoto:

Another candidate for Satoshi has been named as John Forbes Nash Jr., the mathematician who had a Hollywood film A Beautiful Mind (2001) made about his life.

Hal Finney was aware of Nash:

Following on from the idea of “proto-Extropian” — and given Nash’s work in cryptography, mathematics, game theory, and economics — there are 19 compelling reasons to believe Nash was Satoshi:

1. The shared characteristic of decentralisation in Nash and Satoshi systems

A quirk of Bitcoin is it’s commonly championed for the characteristic of decentralisation, yet its white paper doesn’t reference this characteristic in such popular terms.

Rather, it speaks to decentralisation in reference to solving the problem of double-spending (fraud) and removing a trusted central mint by which the entire money system depends (Bitcoin: A Peer-to-Peer Electronic Cash System, section 2).

With regard to decentralisation, and in 1954, John Nash had a futuristic idea for “electronic brains” of the future:

“the idea is to decentralize control with several different control units capable of directing various simultaneous operations and interrelating them when appropriate” John Nash, Parallel Control, 1954

Satoshi in his bitcoin talk forum posts, refers to the decentralised nature of bitcoin:

“A lot of people automatically dismiss e-currency as a lost cause because of all the companies that failed since the 1990’s. I hope it’s obvious it was only the centrally controlled nature of those systems that doomed them. I think this is the first time we’re trying a decentralized, non-trust-based system.” Satoshi Nakamoto, 15 February, 2009

2. Satoshi’s reference to Bitcoin as an age-old design

Nash’s Parallel Control design says this on avoiding single points of failure:

John Nash

Satoshi says this on the same subject:

“The result is a distributed system with no single point of failure. Users hold the crypto keys to their own money and transact directly with each other, with the help of the P2P network to check for double-spending.” Satoshi Nakamoto, 11 February, 2009

Nash wanted his Parallel Control design to have wide applicability:

John Nash
John Nash

As did Satoshi for his bitcoin system:

“The design supports a tremendous variety of possible transaction types that I designed years ago.” Satoshi Nakamoto, 17 June, 2010

3. The shared method of problem solving

Nash on problem solving:

John Nash

Satoshi on the two problems the Bitcoin proof of work computation solves:

“Digital signatures provide part of the solution, but the main benefits are lost if a trusted third party is still required to prevent double-spending. We propose a solution to the double-spending problem using a peer-to-peer network.” Bitcoin: A Peer-to-Peer Electronic Cash System, Abstract.

“The proof-of-work also solves the problem of determining representation in majority decision making.” Bitcoin: A Peer-to-Peer Electronic Cash System, Section 4

Trial, error, and chance also feature in the Nash and Satoshi methodology:

John Nash

“The proof-of-work is a Hashcash style SHA-256 collision finding. It’s a memoryless process where you do millions of hashes a second, with a small chance of finding one each time.” Satoshi Nakamoto, 15 November, 2008

4. Nash and Satoshi’s convergent thinking on inflation

John Nash’s work on Ideal Money was based on the idea that a money should ideally be inflation-free, but realised this might cause a problem if it didn’t circulate:

John Nash

So John Nash introduced a steady and constant inflation rate which would be more or less as good as to be free of inflation:

John Nash

The parallel with bitcoin is clear:

“The steady addition of a constant of amount of new coins is analogous to gold miners expending resources to add gold to circulation. In our case, it is CPU time and electricity that is expended.” Bitcoin: A Peer-to-Peer Electronic Cash System, Section 6

5. “Uncommitted agency” in Nash and Satoshi systems

Satoshi on bitcoin nodes:

“Messages are broadcast on a best effort basis, and nodes can leave and rejoin the network at will, accepting the longest proof-of-work chain as proof of what happened while they were gone.” Bitcoin: A Peer-to-Peer Electronic Cash System, Abstract.

John Nash, in his Agencies Method, which evolved concurrently to his work on Ideal Money, developed an election procedure in respect to experimental studies on coalitions and coalition formation, the results of which were found to be “computationally heavy” and analogous to a scheme of “robotic attorney agents”:

John Nash

6. Similar indications on the value of contracts

Satoshi on contracts:

“The design supports a tremendous variety of possible transaction types that I designed years ago. Escrow transactions, bonded contracts, third party arbitration, multi-party signature, etc. If Bitcoin catches on in a big way, these are things we’ll want to explore in the future, but they all had to be designed at the beginning to make sure they would be possible later.” Satoshi Nakamoto, 17 June, 2010

Nash on the application of “ideal money” in contracts:

John Nash

7. Nash and Satoshi’s shared distrust of central banks

Satoshi on central banks:

“The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.” Satoshi Nakamoto, 11 February, 2009


Nash on debt pardoning:

John Nash

Nash on “Keynesians”:

John Nash

“…a “Keynesian” would favor the existence of a “manipulative” state establishment of central bank and treasury which would continuously seek to achieve “economic welfare” objectives with comparatively little regard for the long term reputation of the national currency..” John Nash, Ideal Money, 2003

“Those coins can never be recovered, and the total circulation is less. Since the effective circulation is reduced, all the remaining coins are worth slightly more. It’s the opposite of when a government prints money and the value of existing money goes down.” Satoshi Nakamoto, 10 December, 2009

8. Citations in common on the idea of “collectibles” and “hoarding”

“Lost coins only make everyone else’s coins worth slightly more. Think of it as a donation to everyone.” Satoshi Nakamoto, 21 June, 2010

“Bitcoins have no dividend or potential future dividend, therefore not like a stock.

More like a collectible or commodity.” Satoshi Nakamoto, 27 August, 2010

John Nash

9. The Extra-Terrestrial


“The space people may just be getting lazy using their language’s split function.” Satoshi Nakamoto, July 21, 2010

John Nash

10. Nash and Satoshi’s shared belief in “new money”

John Nash

“I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party.” Satoshi Nakamoto, 31 October, 2008

And on the internally divisible nature of the new money:

“Eventually at most only 21 million coins for 6.8 billion people in the world if it really gets huge.

But don’t worry, there are another 6 decimal places that aren’t shown, for a total of 8 decimal places internally. It shows 1.00 but internally it’s 1.00000000. If there’s massive deflation in the future, the software could show more decimal places.” Satoshi Nakamoto, 6 February, 2010

John Nash

11. “Difficulty” ,“adjustment”, “the moving average”, as axioms in Nash and Satoshi systems

John Nash

“As computers get faster and the total computing power applied to creating bitcoins increases, the difficulty increases proportionally to keep the total new production constant. Thus, it is known in advance how many new bitcoins will be created every year in the future.” Satoshi Nakamoto, 8 November, 2008

John Nash

“To compensate for increasing hardware speed and varying interest in running nodes over time, the proof-of-work difficulty is determined by a moving average targeting an average number of blocks per hour. If they’re generated too fast, the difficulty increases.” Satoshi Nakamoto, 8 November, 2008

John Nash

12. Uniqueness

John Nash

“I don’t believe a second, compatible implementation of Bitcoin will ever be a good idea. So much of the design depends on all nodes getting exactly identical results in lockstep that a second implementation would be a menace to the network.” Satoshi Nakamoto, 17 June, 2010

13. Shared expectancy in Nash and Satoshi systems

John Nash

“It might make sense just to get some in case it catches on. If enough people think the same way, that becomes a self fulfilling prophecy.” Satoshi Nakamoto, 16 January, 2009

John Nash

“A rational market price for something that is expected to increase in value will already reflect the present value of the expected future increases. In your head, you do a probability estimate balancing the odds that it keeps increasing.” Satoshi Nakamoto, 21 February, 2010

John Nash
John Nash

14. Reoccurring ideas on “law” in Nash and Satoshi systems

The opening passages in the bitcoin white paper uses terminology and descriptions of mediation, disputes, reversibility, trust and fraud, which are all features of litigation. The two problems bitcoin says it solves (double spending, and determining representation in majority decision making) are also representative of legal processes, like escrow and how it can disincentive “cheating”:

“In this kind of escrow, a cheater can’t win, but it’s still possible for you to lose. It at least takes away the profit motive for cheating you. The seller is assured that the money is reserved for him, while the buyer retains the leverage that the seller hasn’t been paid yet until completion.” Satoshi Nakamoto, 26 September, 2010

With the emphasis on prevention:

“Identities are not used, and there’s no reliance on recourse. It’s all prevention.” Satoshi Nakamoto, 15 November, 2008

Nash’s work in the Ideal Money and Agencies Method had a common focus on the nature and importance of contracts:

John Nash
John Nash
John Nash

And Nash on the utility of “ideal money” in dispute resolution:

John Nash

15. Common references to gold in Nash and Satoshi systems

“Our proposal is that a preferable version of a general system for the transferring of utility, thus a “medium of exchange”, would be structured so as to provide a medium with a natural (and reliable!) stability of value. And this stability of value would be particularly of benefit in connection with contracts or exchanges involving long time periods for the complete performance of the contract or exchange.

Classically, when gold or silver was used as the basis of a standard for exchanges, that objective was consequently achieved..” John Nash, Ideal Money, 2010

John Nash

“It’s the same situation as gold and gold mining. The marginal cost of gold mining tends to stay near the price of gold. Gold mining is a waste, but that waste is far less than the utility of having gold available as a medium of exchange.

I think the case will be the same for Bitcoin. The utility of the exchanges made possible by Bitcoin will far exceed the cost of electricity used. Therefore, not having Bitcoin would be the net waste.” Satoshi Nakamoto, 7 August, 2010

“As a thought experiment, imagine there was a base metal as scarce as gold but with the following properties:
- boring grey in colour
- not a good conductor of electricity
- not particularly strong, but not ductile or easily malleable either
- not useful for any practical or ornamental purpose

and one special, magical property:
- can be transported over a communications channel

If it somehow acquired any value at all for whatever reason, then anyone wanting to transfer wealth over a long distance could buy some, transmit it, and have the recipient sell it.” Satoshi Nakamoto, 27 August, 2010

John Nash

Is Satoshi referencing pro-cooperative games in relation to gold below?

“Imagine if gold turned to lead when stolen. If the thief gives it back, it turns to gold again.” Satoshi Nakamoto, 11 August, 2010

16. The value of words in Nash and Satoshi systems

Satoshi on words at work:

“Proof-of-work has the nice property that it can be relayed through untrusted middlemen. We don’t have to worry about a chain of custody of communication. It doesn’t matter who tells you a longest chain, the proof-of-work speaks for itself.” Satoshi Nakamoto, 17 August, 2010

Nash on “words”:

John Nash

Satoshi on words:

“It’s very attractive to the libertarian viewpoint if we can explain it properly. I’m better with code than with words though.” Satoshi Nakamoto, 14 November, 2008

Nash on verbal complications in contracts:

John Nash

17. Proof of work as a solution to Prisoner Dilemma games and the Byzantine Generals’ Problem

“The proof-of-work chain is the solution to the synchronisation problem, and to knowing what the globally shared view is without having to trust anyone.” Satoshi Nakamoto, 9 November, 2008

“The proof-of-work chain is a solution to the Byzantine Generals’ Problem. I’ll try to rephrase it in that context.” Satoshi Nakamoto, 13 November, 2008

John Nash

18. Honesty in Nash and Satoshi systems

“If an appropriately honest government-like agency is to issue the actual currency, and to provide for the central bank deposits denominated in terms of that currency, for a money system, then it can also, naturally, compute the indexes that would measure the presence or absence of inflation or deflation.” John Nash, Ideal Money, 2011

“By convention, the first transaction in a block is a special transaction that starts a new coin owned by the creator of the block. This adds an incentive for nodes to support the network, and provides a way to initially distribute coins into circulation, since there is no central authority to issue them…The incentive may help encourage nodes to stay honest.” Bitcoin: A Peer-to-Peer Electronic Cash System, Section 6

19. Accepted agency of players in games

“With the possibility of reversal, the need for trust spreads. Merchants must be wary of their customers, hassling them for more information than they would otherwise need.” Bitcoin: A Peer-to-Peer Electronic Cash System, Section 1

John Nash