Bitcoin’s Hidden Edge: How Mystery Drives Market Advantages and Investor Behavior

In 2008, filmmaker J.J. Abrams delivered a TED Talk that would go on to become a seminal moment in the director’s career. Years before he would become a household name thanks to the success of blockbusters like 2009’s Star Trek or 2015’s Star Wars: The Force Awakens, Abrams was predominantly a television writer and producer. He had worked on shows like Lost and Alias and, in that time, had cultivated a distinct writing ideology that fueled the majority of his work: the mystery box. In his 2008 TED Talk, Abrams outlined this approach to storytelling extensively.

Abrams’ idea wasn’t just about storytelling. It was about human psychology. People are wired to chase answers, even when the payoff is unclear. It’s a principle that applies far beyond Hollywood. In fact, it’s a phenomenon that can help explain one of the most unpredictable and compelling forces in financial markets today: the bitcoin price.

Bitcoin, after all, is built around one of the greatest modern mysteries: who created it? The elusive figure of Satoshi Nakamoto, the pseudonymous inventor of Bitcoin, has never been conclusively identified. And this lingering enigma isn’t just a fun piece of trivia. It’s a major reason why Bitcoin has captured the imagination of millions and helped fuel the volatility and cultural obsession that often drives up the Bitcoin price.

Bitcoin’s Rise to Success

While cryptocurrency didn’t palpably enter the public zeitgeist until 2020, amid institutional change and COVID-19 lockdowns, Bitcoin was first introduced to the market in 2008. Long before practically anyone else was considering pivoting so wholly into digitized services or goods, a mysterious man named Satoshi Nakamoto published a nine-page white paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System.”

For context’s sake, in 2008, MySpace was still the most popular social media platform, and even something as simple as online shopping was still viewed through a heavy lens of skepticism by general consumers. To this end, it would appear as though Nakamoto’s foresight was outright prescient, only lending even greater mystique to the central mystery at the heart of Bitcoin’s founding.

That initial white paper extensively outlined a digitized form of currency that would serve to circumnavigate traditional banks in favor of personalized online currency. In many ways, this allowed Bitcoin to build upon structures that were already in place and have been for decades while using them to innovate in new ways. When you put your money in a bank, it doesn’t simply sit there in a vault with your name on it. Instead, the bank keeps inventory of how much money you’ve given them and then is prepared to pay out that amount to you when you require it. This system has proven largely reliable over the years, with notable exceptions such as runs on banks, in which widespread panic is instilled over the disappearance of funds.

Bitcoin takes this truth of banking and essentially removes the middleman of the banks themselves, instead converting all funds to digitized currency and allowing individuals to hold it for themselves.

Why the Mystery?

It is widely agreed upon that Satoshi Nakamoto was not, in fact, a real person but instead an alias that was used by either one or multiple individuals in the founding of Bitcoin. This is a notable point of differentiation for Bitcoin as a form of cryptocurrency, however, as other popular cryptocurrencies have founders who are eager to be publicly identified and become synonymous with the brand itself. So why all the mystery?

For starters, it is compelling and has had people talking about it for nearly two full decades now. The intensity of scrutiny surrounding the mysterious identity of Bitcoin’s founder skyrocketed when the value and popularity of the currency did so in 2020. As a result, in the years since, numerous articles, videos, and even documentaries have been made attempting to answer the question. Additionally, it’s worth considering just how out-of-left-field Bitcoin’s founding would have seemed to mainstream audiences in 2008. The brand had every chance of failing spectacularly, so perhaps the individual responsible didn’t wish to be defined by that for the rest of their career.

Furthermore, there’s the sheer volatility of the value of cryptocurrency and all of the various factors that affect it to consider. While it may be great to be the head of a company and act as the brand’s public-facing spokesperson, should that person then do anything illicit or morally questionable, things can turn dire quite quickly. In such a scenario, the actions of the founder often have a direct impact on the value of the brand. Considering that cryptocurrency is already a tumultuous market, perhaps the founder of Bitcoin foresaw these potential pitfalls and wished to avoid them.

Final Thoughts

Recently, an HBO documentary called Money Electric: The Bitcoin Mystery attempted to solve the mystery behind the crypto giant and purports to have unveiled Peter Todd as the true identity behind the Satoshi Nakamoto name. However, Todd vehemently denied this to the press. After nearly twenty years of secrecy, it seems increasingly unlikely that anyone will admit to being Satoshi anytime soon. For now, Bitcoin’s price is surging and the currency is reaching unparalleled levels of success, so the brand has no reason to shake things up. As J.J. Abrams preaches and practices, mysteries keep people invested, even if the ultimate answer is a letdown. To this end, so long as there’s plausible deniability surrounding the founder of Bitcoin, the mystery and its wealth will live on.

The Paste editorial staff was not involved in the creation of this content.