Craig Wright, self-proclaimed bitcoin inventor Satoshi Nakamoto, looks likely to be ordered by a Florida court to hand over millions of dollars in bitcoin and intellectual property rights.

Twitter posts by members of the court audience on Monday August 26, said Judge Bruce Reinhart rejected Wright’s testimony in his defense of allegations of theft and fraud by the estate of his late business partner David Kleiman.

Judge Reinhart reportedly said that Wright had perjured himself by presenting the court with falsified documents and recommended that he hand over half of the more than 1 million bitcoins he mined together with David Kleiman, as well as intellectual property rights to bitcoin software.

The Case

Lawyers acting on behalf of Ira Kleiman, brother of David who passed away in April 2013, filed the case against Wright in February 2018, alleging he had appropriated the share of bitcoins he had mined in partnership with David.

Wright spent many months arguing that the Florida District Court, where much of the legal action has been heard, had no jurisdiction over the case. This was overturned earlier in August by Judge Beth Bloom, who – in delivering her verdict – said the court did not find Wright’s testimony to be credible.

In June, documents the court had demanded Wright to produce – that would show his bitcoin holdings prior to December 2013 – were handed over several weeks late in July. On examination, lawyers for the Kleiman estate found various anomalies that showed the documents to be falsified.

Indeed, a document showing the bitcoin addresses of trustees of the Tulip Trust fund at the center of the case that claimed to be dated from 2012, was printed in a font that had been updated in 2015.

Observers Talk

Although the case has yet to be officially wrapped up, Twitter user 22nd Century Crypto was at Monday’s hearing where Judge Reinhart was reported to have rejected all of Wright’s testimony and found that he had committed perjury and falsified documents.

WizSec Bitcoin Research said the judge had “struck all of Wright’s affirmative defenses as inconsistent, and found Wright committed perjury and forged evidence”. It was also established that half of the assets of W&K – the company owned by Wright and Kleiman – belonged to Kleiman.

Katie Ananina – also at the courthouse – summed it up with this series of tweets:

Reaction

Wright was interviewed by Modern Consensus following the decision and said he had “no choice but to hand over $5 billion in bitcoin”. 

The news sent some bitcoin users into a flurry of concerns that the Kleiman estate will sell all the bitcoins awarded by the court and crash the price. At midday London time on Tuesday, the price of bitcoin was down 2.4% at $10,136.

Wright added in the Modern Consensus interview:

The judge ordered me to send just under 500,000 BTC over to Ira. Let’s see what it does to the market. I wouldn’t have tanked the market. I’m nice.