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> It’s possible that Satoshi himself will try to liquidate his stake at some point, crashing BTC itself and make off with a cool billion. Who knows. That might have been the plan all along.

Not quite possible with the auditing capabilities Bitcoin provides. The moment any amount from those accounts is moved, Bitcoin would probably tank.

There is no auditing whether he sold all his keys in the physical world. They may never have "transacted" on the blockchain, but that does not mean he never just gave away the ability to transact them physically.

He may also have taken out a loan from a traditional financial institution and used them as collateral.

There is a very real possibility that they are in fact owned by someone else now, who has made the same exact calculation you have - they are a valuable asset that has exactly zero liquidity.

> There is no auditing whether he sold all his keys in the physical world.

Are you trying to claim that someone would buy Satoshi's coins without moving them to a wallet they control?

In this scenario, the person would have 'purchased' the coins with precisely zero assurance that Satoshi wouldn't just move them to a new address at any point, as he/she/they still have the private keys.

Someone could have the whole wallet...

As I said, it is impossible to verify that that isn't the case. He could have taken a loan with the whole wallet as collateral. That isn't the same as claiming that Satoshi did that, but it's not like the audibility of the blockchain spreads all the way to the real world. There's really no saying what Satoshi has done, and the anonymity means there's no way to find out.

It.. doesn't work like that. Suppose someone sells you a private key, or even a hardware wallet, claiming that it "contains much Bitcoin". There's no way for you to be sure that the seller doesn't have a backup. Or is selling ten other copies to other people.

It's like trying to sell an account by selling the password to it. The first thing you do is change it so the previous owner can not get in anymore. Before you did that you can not be sure that you are the only one with access. On Bitcoin the only way to change the password is to move the funds to a new address.

It works that way if he transferred the private key and then they murdered him. Blockchains and meatspace have different rules.

The only way anyone could assume control of the account as collateral is by knowing the private key. If the funds are not transferred to another wallet, then both parties now have knowledge of the private key. As such, the entity providing the loan has to trust that Satoshi will not move the funds. That would be an insane risk to take.

But would someone ever buy bitcoins from someone without actually permitting a transfer? How would you ever have an assurance that seller has relinquished control of the coins?

Example: I own one coin. I sell my private key to you for $5k fiat. You take my private key and sit on it thinking it’s yours. After a use a copy of the private key to transfer the coin to a new wallet I own. I’ve now stollen the coin I supposedly “sold” to you.

What am I missing?

Why should it tank? This would resolve uncertainty about the fate of a few percent of the whole supply, so the direct effect is bounded by that few percent (depending on how likely the market thinks it's been lost).

Indirectly it could jump-start a recursive reaction, but then anything could.

Dumping most of it all at once could tank the price, but to do that Satoshi would have to be an idiot.

Wouldn't someone in that position just start a slow and consistent divestment over a long period of time? Make it business as usual.

The wallets have been untouched for a decade. The first bitcoin to sell from it wouldn't actually crash the market, but the emotional effect of a small chunk of a very large chunk suddenly moving would be fairly big.

I don’t disagree, but it could have the reverse effect.

Everything from just a ton of media attention and some adoption, to maybe something really positive like coins getting deposited to charity wallets (pineapple foundation seemed to get a lot of attention/vitality for donating their bitcoin).

And it would be pretty ironic if it the coins moved and price of bitcoin crashed and actually became a peer to peer electronic currency for the masses.

> And it would be pretty ironic if it the coins moved and price of bitcoin crashed and actually became a peer to peer electronic currency for the masses.

The price of Bitcoin isn't what is preventing it from becoming a bonafide peer to peer electronic currency. Scalability and UX issues are.

I agree with UX, but scalability has a working solution in the Lightning Network. However, that needs major UX development...

Bitcoin also needs fungibility:

"Fungibility is the only property of sound money that is missing from Bitcoin & Litecoin. Now that the scaling debate is behind us, the next battleground will be on fungibility and privacy. I am now focused on making Litecoin more fungible by adding Confidential Transactions." -Charlie Lee


> but scalability has a working solution in the Lightning Network.

Not without an increase in the block size, which has been a contentious issue. At 7 transactions per second, it would take 31 years of full blocks for every person on Earth to just open a Lightning channel each, in uninterrupted succession.

Sell a tiny bit and then wait until it recovers. Rinse and repeat.

Sell a tiny bit, buy a lot when it tanks, sell the new lot.

Could also do that but when you have Satoshi amounts the problem becomes getting rid of it so I'm not sure buying more will help beyond the obfuscation advantages of holding it in a different wallet.

I wonder what the maximum leverage you could short with if you had access to those coins...

Break the private key, do a 30x leverage short and move the coins!

It is that last bit where it gets sticky.

If you tank the market and create systemic insolvency then you might hold $1B of short contracts at an exchange where the operators have packed up and fled to anonymous sandy beaches, and for all your cleverness those contracts and $10 might buy you lunch tomorrow.

> It is that last bit where it gets sticky.

I understand we're doing thought experiments here, but I'd say the really tricky part is breaking the private key.

> the really tricky part is breaking the private key

That's the interesting thing, you can try to brute force keys in general by just throwing enough money at the problem. Technology always advances and makes cryptography less secure.

Could this work? Just run an exchange and become long cash and short bitcoin, or acquire an exchange that is long cash and short bitcoin. Liquidate the exchange and everyone is even.

It's gotta be doable with the amount of exchanges that we've seen that are short both!

It would tank, but he still may be able to do it. Even if the price plummeted to 1/10th its current value it would still be a fortune.

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