​Self-proclaimed Australian 'bitcoin founder' builds patent blockchain empire

Craig Wright, the Australian who claims to be the inventor of bitcoin, is attempting to build a large patent portfolio around digital currency and technology underpinning it, according to associates of his and documents reviewed by Reuters.

Since February, Wright has filed more than 50 patent applications in the United Kingdom through Antigua-registered EITC Holdings Ltd, which a source close to the company confirmed was connected to Wright, government records show.

Interviews with sources close to EITC Holdings Ltd, which has two of Wright's associates as directors, confirmed it was still working on filing patent applications; while the UK's Intellectual Property Office has published another 11 patent applications filed by the company in the past week.

"None of this has stopped," one person close to the company said.

The person declined to be identified because they were not authorised to speak to the media.

Wright did not respond to requests seeking comment.

The granting of even some of the patents would be significant for banking and other industries that are trying to exploit bitcoin technologies, as well as dozens of startups scurrying to build business models based around it.

Financial institutions are expected to spend more than AU$1.35 billion over the next two years on projects linked to the "blockchain" at the heart of bitcoin, according to a survey by boutique investment bank Magister Advisors.

The blockchain is a public database that bypasses money-based payments by recording all transactions digitally.

The Australian Stock Exchange is an example of one company that has started to embrace blockchain technology. It is currently working with Digital Asset to develop blockchain technology to replace or upgrade its main trading and post-trade platforms.

In addition, the the Australian government announced plans recently to remove the "double tax" treatment from those dealing in digital currency such as bitcoin.

It said blockchain technology has attracted considerable interest, adding that it is currently being applied to a number of areas within the international financial system. The government believes the technology has the potential to revolutionise key services like international transfers between banks, equities clearing and settlement, and financial contracts.

The federal government reaffirmed its plans for removing the double tax treatment as part of the 2016 Budget.

Proponents say it has the potential to disrupt financial services by making payments and the settling of securities transactions, in particular, far cheaper.

Patents that Wright has applied for range from a mechanism that enables secure payment for online content to an operating system for running an "internet of things" on blockchain.

A patent schedule, one of a number of documents relating to the applications shown to Reuters by a person close to the EITC Holdings, outlines plans to apply for about 400 in total.

The London Review of Books (LRB) on Saturday ran an article by novelist and journalist Andrew O'Hagan quoting associates of Wright's as saying that they were working on filing several hundred patents.

O'Hagan, who has spent extensive time with Wright and others close to him, quoted the associates as saying that Wright's patents would then be sold "for upwards of a billion dollars".

The article did not explain how this valuation was reached, how far the process of contacting purchasers had gone, or whether it was still active.

Nearly all the UK filings involve the term "blockchain" or its more generic description, the "distributed ledger".

The patent approval process typically takes several years.

"It looks like he is trying to patent the fundamental building blocks of any blockchain, cryptocurrency, or distributed ledger system," said Antony Lewis, a consultant on bitcoin issues to whom Reuters showed the patent titles and some of the texts.

In May, Wright backtracked on a promise to provide "extraordinary proof" he was the creator of bitcoin, stating in a blog post at the time he no longer had the "courage" to do so.

This came after Wright informed the BBC, The Economist, and GQ that he was Satoshi Nakamoto, the pseudonym used by the creator of the digital currency.

He had said he was going to move some of the early bitcoin to prove he was Nakamoto, but reversed his position days later.

"I'm sorry. I believed that I could do this. I believed that I could put the years of anonymity and hiding behind me," Wright wrote in his blog.

"But, as the events of this week unfolded and I prepared to publish the proof of access to the earliest keys, I broke. I do not have the courage. I cannot."

The identity of Nakamoto and whether Wright is the person behind it has long been questioned.

Based on leaked transcripts of legal interviews and files, Gizmodo and Wired previously highlighted there was evidence to suggest Wright, along with computer forensics analyst David Kleiman, who died in April 2013, are the men behind Nakamoto.

Wired claimed in its report that it obtained "the strongest evidence" yet that shows Wright is the man behind the identity of Nakamoto. However, it also cited the leaked documents it acquired remain unverified, and quite possibly fake or an "elaborate hoax -- perhaps orchestrated by Wright himself", with some evidence later altered.

"Despite a massive trove of evidence, we still can't say with absolute certainty that the mystery is solved. But two possibilities outweigh all others: Either Wright invented Bitcoin, or he's a brilliant hoaxer who very badly wants us to believe he did," Wired wrote.

Meanwhile, Gizmodo obtained a transcript in which Wright tells the Australian Taxation Office (ATO) that he has been "running Bitcoin since 2009".

However, the claims made by Gizmodo and Wired of whether Wright is the creator of Bitcoin are true or not continues to be questioned by the bitcoin community.

Based on Wright's LinkedIn profile -- which has since been removed -- it indicated he was involved in a number of Australian tech enterprises including holding the role of CEO at DeMorgan, a "pre-IPO Australian-listed company focused on alternative currency" that controls companies such as C01N, an electronic wallet and transaction processor based on the Bitcoin blockchain.

At the end of last year, Wright's home and office were allegedly raided by the Australian Federal Police (AFP) in relation to an ATO investigation.

AFP informed Reuters at the time that all officers' presence at the home was not associated with bitcoins, but rather what they were doing there was just "clearing the house".

Around the same time, high performance computing firm SGI denied its involvement with Cloudcroft Supercomputers Australia, a supercomputer firm that was founded by Wright under his parent company DeMorgan.

In a letter featuring the SGI letterhead and the supposed signature of SGI APAC service director Greg McKeon, SGI acknowledged it would be assisting Cloudcroft Supercomputers Australia in the development of hyper-density machines and supercomputers.

"As a global leader in high performance solutions for computers, data analytics and data management, SGI considers Cloudcroft a worthy partner in the goal to accelerate time to discovery, innovation and profitability," the letter said.

The letter also highlighted the two companies previously worked together to build Cloudcroft's first supercomputer, Sukuriputo Okane.

Further evidence to suggest that Wright was the supposed owner of a supercomputer was highlighted in a Cloudcroft blog posted in December 2014, which indicated that Wright at the time had intentions to build "the biggest supercomputer cluster in Australia, with just under 5 petabytes", in time for the release of the Top 500 in June 2015.

However, Cassio Conceicao, SGI EVP and chief operating officer, told ZDNet at the time that despite this, SGI never had any contact with Cloudcroft or Wright.

"Cloudcroft has never been an SGI customer and SGI has no relationship with Cloudcroft CEO Craig Steven Wright," he said.

Conceicao added that SGI had no record of the C01N supercomputer being purchased or serviced by the firm. The C01N supercomputer, which was placed at number 17 on the list of the world's fastest supercomputers in November, is another supercomputer that Wright apparently owned. It was allegedly created when Wright merged C01N and Tulip Trading, Cloudcroft's supposed flagship supercomputer, into a single high performance computer.

"SGI has no record of the CO1N supercomputer ever being purchased or serviced from SGI, therefore SGI suspects it may have been purchased on the grey market," Conceicao said. "SGI does not operate, maintain, or provide any services for this supercomputer."

With AAP