NEW YORK — After being out of print for 14 months, Newsweek wanted its return to the newsstands to land with a splash. So it put out an issue with a darkened cover featuring a theatrical silver mask and made an explosive claim: It had uncovered the mysterious founder of the digital currency Bitcoin.
Within hours of publication, however, the story seemed to swell from a splash to a runaway tsunami of attention, much of it negative. The man Newsweek identified as Bitcoin’s founder, Dorian Satoshi Nakamoto, a reclusive train collector from California, gave a two-hour interview to the Associated Press saying that the story was wrong.
Reporters and commentators quickly questioned whether the writer, Leah McGrath Goodman, had produced the definitive proof her magazine had promised, noting that the central quote from Nakamoto appeared to fall short of a clear confirmation.
Meanwhile amateur sleuths on the Internet tried to challenge the evidence amid a heavy dose of hostility aimed at the author directly.
Newsweek’s editor-in-chief, Jim Impoco, on Friday offered a vigorous defense of the article.
“We are absolutely standing by this,” he said in a phone interview. He added that the idea that the story hung on the brief confirmation from Nakamoto was wrong. “It was an exhaustive investigation,” he said. “We brought in help from MIT. All leads led to him.”
Goodman on Friday seemed surprised at the ferocity of the attacks against her. On “CBS This Morning,” she insisted again that Nakamoto had definitely confirmed to her he was a founder. Referring to a bizarre scene Thursday, when reporters who were camped outside Nakamoto’s house formed a caravan to follow him down the highway to the AP interview, she told CBS: “Seeing him flee the scene and now deny it, I have to say it is mystifying to me.”
The article describes a brief conversation outside Nakamoto’s house witnessed by two deputies from the sheriff’s office, in which Goodman asked him about Bitcoin.
“I am no longer involved in that, and I cannot discuss it,” she quotes him as saying. “It’s been turned over to other people. They are in charge of it now. I no longer have any connection.”
Nakamoto told the AP that he had misunderstood what she was asking him.
In an e-mailed statement to The New York Times, Goodman wrote in part: “My conversation with Mr. Nakamoto followed two months of team-based research that connected the dots to him — and only him — in multiple ways. I can definitively say that in our conversation, he made clear he understood we were talking about Bitcoin.”
In featuring the Bitcoin story, Newsweek was engaging a particularly passionate audience. Bitcoin, a virtual currency that is meant to allow smooth financial transactions across borders without government involvement, has a zealous group of devoted technologists, speculators, and libertarian ideologues. It has also made headlines in several areas — for its big-name investors like Cameron and Tyler Winklevoss, and, most recently, the spectacular bankruptcy filing of a trading exchange, Mt. Gox, with more than $450 million worth of coins reported to have gone missing.
And as Bitcoin has gone from a fringe digital experiment to a mainstream digital experiment, the search for its secretive creator, or creators, has become something of a holy grail.
The disclosure of the extent she went to investigate Nakamoto only seemed to enrage Bitcoin fans. Many on the Web, and in particular on the social network Reddit, expressed great sympathy for the toll this has taken on Nakamoto, whether he is the creator of Bitcoin or not, and were outraged that Newsweek saw fit to invade his privacy.
On Friday, Newsweek felt compelled to issue a plea for restraint, saying in a statement that it “encourages all to be respectful of the privacy and rights of the individuals involved.”
Goodman, in a phone interview, suggested that people would have to draw their own conclusions from the material she presented.
“Everyone wants a smoking gun,” she said.