Controversy is surrounding claims by Newsweek to have found the creator of the Bitcoin virtual currency.

It was assumed that the name behind Bitcoin, Satoshi Nakamoto, was a pseudonym for the group of coders who developed the system.

Now Newsweek claims Dorian S Nakamoto, a 64-year-old model train enthusiast who lives on the outskirts of Los Angeles, is the creator.

However, he denied his involvement in an interview with the Associated Press.

Mr Nakamoto said he hadn't heard of the cryptocurrency until his son told him about it after being contacted by a reporter.

Newsweek reporter Leah Goodman said in the article, she tracked Mr Nakamoto down by seeking public records for US citizens bearing that name. She then investigated people whose background, education and employment history showed they might be capable of creating the crypto-currency.

Ms Goodman's enquiries focussed on one candidate in particular who seemed to have the right profile and whose involvement was hinted at by other Bitcoin developers.

Further evidence, she said, arose when talking to his family members revealed his obsession with privacy, his political leanings and his facility with maths.

The evidence led Ms Goodman to confront Mr Nakamoto at his home where she asked if he was the creator of Bitcoin.

Many Bitcoin commentators on social networks have expressed scepticism about the find saying the evidence Ms Goodman gathered was not convincing. The story was called "fake" by some commentators on the Bitcoin Talk forum who demanded Mr Nakamoto carry out signed Bitcoin transactions to prove that he was the currency's originator.

Others criticised Newsweek for publishing a picture of Mr Nakamoto and revealing so much about his life.

On Twitter, Ms Goodman said the magazine had only printed information that was publicly available.

Bitcoin not a currency says Japan government

A number of countries have imposed restrictions on transactions in Bitcoins

"If there are transactions and subsequent gains, it is natural...for the finance ministry to consider how it can impose taxes," said chief cabinet secretary Yoshihide Suga.

Japan also said banks cannot provide bitcoin as a product to customers.

The government is trying to determine the total volume and value of bitcoins in circulation around the world.

China ban

Some estimates put the global market for Bitcoins, a virtual currency created, or 'mined' through complicated computer algorithms, at about $7bn (£4.2bn).

Countries and their tax authorities have been grappling with how to regulate it, with some seeing it as a route for tax evasion or money laundering.

Russia has declared transactions illegal, China has banned its banks from handling Bitcoin trades, and there have been calls for the US to do the same.

Singapore has imposed a tax on Bitcoin trading and using it to pay for services, after classifying it as goods, rather than a currency.

Last month leading Bitcoin exchange, Tokyo-based MtGox, filed for bankruptcy after losing an estimated 750,000 of its customers' Bitcoins.

Source: BBC