Ever since I worked at First Republic Bank I’ve wondered if cryptocurrency was a scam. That suspicion was mostly born of ignorance — I didn’t fully understand what it actually was. So recently I decided to dig in. What follows is a distillation of what I learned. I’m sharing it in the hope it’s useful to anyone else who’s been skeptical or curious.
Introduction
Crypto sits at the intersection of technology, finance, and ideology, and that makes it fertile ground for myths and conspiracy theories. One of the most persistent of these is the idea that Bitcoin wasn’t invented by a lone pseudonymous developer but by a government (or group of governments) as part of a larger plan. There’s also the mystery of Satoshi Nakamoto, the anonymous creator who vanished without touching a reputedly enormous fortune. Both threads—official-actor theory and the human mystery—are worth unpacking if you want to separate plausible concerns from conspiracy.
The “Bitcoin Was Developed by Governments” Theory
At its core, this theory argues that Bitcoin’s origins are too convenient and too sophisticated to be the work of a single anonymous person. Instead, the narrative suggests a state actor (or group) engineered Bitcoin, using the name Satoshi Nakamoto as a cover.
Why people find the idea plausible
- The whitepaper and initial code were polished and technically advanced, which fuels the idea that a well-funded, highly skilled team could be behind it rather than an individual hobbyist.
- Cryptographic research by national agencies (for example, past papers exploring anonymous electronic cash) adds to the suspicion that governments had both the expertise and the motive.
- Bitcoin appeared in October 2008, in the middle of the global financial crisis—an era when public trust in banks and fiat systems was at a low. That timing looks convenient to skeptics.
The alleged motives in the theory
Proponents imagine a few possible state goals:
- Train the public to accept digital money.
- Collect intelligence by normalizing a transparent, traceable ledger.
- Use a crypto system as a stepping stone toward a broader monetary reset or new digital currency architecture.
Sources of Suspicion Often Cited
- Historical research by intelligence agencies into anonymous electronic cash.
- The use of cryptographic primitives that have ties to government research.
- The timing around the financial crisis, which could be read as strategic.
- Satoshi’s disappearance and the fact that an estimated ~1 million BTC attributed to Satoshi have never been moved.
All of these elements create a narrative that feels coherent—especially to people already distrustful of centralized power.
Counterpoints: Why Most Experts Reject the Government Hypothesis
- Bitcoin is open-source and has been publicly auditable since day one. Researchers and independent developers have examined the code intensively for years.
- No credible leak, whistleblower, or document has surfaced to prove state authorship.
- Governments initially reacted with hostility to Bitcoin (shutting down exchanges, targeting illicit uses), which isn’t behavior you’d expect if they had created it as a takeover tool.
- If governments wanted a controllable digital currency, they would have stronger incentives to build and promote centralized CBDCs (central bank digital currencies) rather than a decentralized, volatile asset.
Historical Precedents: New Currencies Born of Crisis
Part of the question is reasonable: have currencies ever been created as crisis responses? The short answer is yes. Some illustrative examples:
- The Rentenmark (Germany, 1923): Introduced to halt hyperinflation and restore trust, backed by land and industry.
- The Continental (United States, 1775–1780s): Issued to finance the Revolutionary War; it failed because it lacked backing and oversupply.
- The euro (1999–2002): Born from political and economic crises that followed the world wars and Cold War fragmentation; it was a coordinated, preemptive unifying currency.
- Zimbabwe (2009): The government abandoned a collapsing currency and allowed foreign currency use; attempts at reintroducing a national currency followed later.
- Post-Soviet republic currencies (1990s): New national currencies emerged after political collapse and economic shock.
Bitcoin’s origin in the wake of the 2008 crisis is sometimes framed in that historical light: a new form of money arising as a reaction to a failing system.
The Main Arguments That Bitcoin Is Not a Scam
Despite the conspiracy theories, there are solid reasons many people believe Bitcoin is not a scam:
- Openness: The protocol and code are public and have been audited for years.
- Decentralization: No single controller, no CEO to shut it down or run away with investor funds.
- Predictable monetary policy: Supply is capped at 21 million by code, making inflationary manipulation very different from fiat.
- Real use cases: Cross-border payments, censorship-resistant store of value in unstable economies, and programmable money via second-layer technologies.
- Verifiability: Anyone can independently verify balances and transactions.
- Longevity: Bitcoin has operated since 2009 and survived numerous existential threats that would have sunk most scams.
- Voluntary participation: No guaranteed returns are promised; adoption has been mostly organic.
Taken together, these features distinguish Bitcoin from classic frauds or Ponzi schemes.
The “Not Backed By Anything” Critique
A common and valid critique is that Bitcoin is not backed by a physical asset or a government guarantee. It’s worth noting:
- Most modern fiat currencies are not backed by gold or an intrinsic asset either; their value rests on collective trust and state authority.
- Bitcoin’s value drivers are scarcity (21 million cap), utility (payments and settlement), decentralization (resistance to censorship), security (vast network hashing power), and belief (network effects and adoption).
So while Bitcoin lacks a traditional backing, it has multiple sources of perceived value—some comparable to gold, others unique to digital systems.
What Could Have Happened to Satoshi Nakamoto?
The disappearance of Satoshi Nakamoto fuels speculation. A few plausible scenarios:
- Death: The simplest explanation—if Satoshi died and private keys were not shared, the coin stash and identity would vanish with them.
- Intentional disappearance: Satoshi might have stepped away on purpose to preserve the project’s leaderless ethos and avoid centralized influence.
- A group pseudonym: “Satoshi Nakamoto” could have been a team identity used to launch the project and then dissolve.
- Alive but silent: Satoshi could be alive and committed to never interfering, or maintaining extreme operational security.
- Forced silence: Some speculate government pressure or other coercion, though there is no solid public evidence for this.
Each scenario explains parts of the mystery but none is proven.
Conclusion
The story of Bitcoin is messy, equal parts computer science, finance, sociology, and mystery. The government-origin theory is a compelling narrative because it stitches together technical sophistication, historical timing, and the disappearance of a creator. But it ultimately lacks decisive evidence, and the open, auditable nature of the protocol and the observable history of adoption provide strong counterarguments.
At the same time, your skepticism is sensible. Bitcoin raises hard questions about what we trust as money, who controls financial systems, and how new technologies can both empower and unsettle societies. The absence of a clear, human claim to authorship—Satoshi’s silence—adds a mythic layer that keeps the debate alive.
Final thought
If a technology this consequential can be launched anonymously and then empowered millions without a central hand guiding it, what does that say about the future of money and who gets to shape it?