PAUL KIERNAN, Wall Street Journal
Weekend Australian 18 Feb 2023
Andrew Chow started tinkering with bitcoin in high school. Unknown to his parents, and before he even had a bank account, the teenage coder set up a website that said “I will work for bitcoin” and provided a wallet address for people to tip him. Seven years later, Chow is one of a handful of people who can write changes into the software that underpins the nearly $US500bn ($730bn) cryptocurrency. Their role is critical to bitcoin, yet is largely unknown to the millions who own it.
Known as maintainers, he and four other coders serve as stewards of Bitcoin Core, an open-source program that keeps the cryptocurrency’s digital ledger up-to-date on thousands of computers that make up its network. Their longtime leader departed on Thursday, reducing the group’s size to five from six.
A succession of crypto-focused trading platforms, asset managers and lenders have collapsed since last northern spring, along with $US2 trillion of collective market value. Linking the disasters were common themes of amateur governance, weak oversight and little transparency. Through the turmoil, bitcoin has remained crypto’s gold standard. Despite a volatile price that is down about two-thirds since 2021, the oldest and most widely held cryptocurrency has hovered at around 40 per cent of the value of the whole cryptocurrency market for years.
Bitcoin’s worth and future potential rest partly in the hands of the Bitcoin Core maintainers, a group chosen by their peers and often vague about their whereabouts. A loose network of donors pays most maintainers’ salaries. At least once, the maintainers secretly patched a bug that bitcoin proponents say could have destroyed the cryptocurrency’s value.
Human core
Aided by a broader community of developers, the maintainers – successors to bitcoin’s mysterious creator, known only by the pseudonym Satoshi Nakamoto – must ensure that the software remains compatible with the latest versions of operating systems such as Windows or MacOS and that it keeps up with transaction volumes.
Software needs more care and feeding than many people think, and Bitcoin Core is no different, says Jameson Lopp, a bitcoin expert who has written code for the project. “It becomes less and less useful. It becomes easier to attack. And so all technology has to have humans behind it, maintaining it.”
In a normal tech company, developers would be organised into a hierarchy, with managers, job descriptions and performance reviews. If it were publicly traded, investors would receive standardised disclosures about its operations and management.
Crypto disclosures to investors are contained not in regulatory filings but in white papers, message boards and in a Byzantine code repository on GitHub, the Microsoft-owned website where Bitcoin Core is stored. Maintainers and other developers discuss high-priority code tweaks and personnel matters in a weekly chat room that is public. Because it is open-source, anyone with a GitHub account can propose changes to Bitcoin Core. What sets maintainers apart is their ability to approve those changes and move them into the GitHub repository. There, the changes become effective once users download software updates that are released every six months or so.
“Whoa you work on bitcoin? This sounds super scary to be working on everyone’s money,” a viewer said by chat last northern summer as Chow live-streamed his coding work on Twitch, something he does every Monday at 2pm. “It can be very scary,” Chow replied, his screen filled with lines of code against a black background. “But it gets easier over time, especially knowing what is dangerous to touch.”
In the past 18 months, four Bitcoin Core maintainers have stepped aside or turned over, citing burnout or legal risk. New maintainers are chosen in adhoc votes after sometimes-heated debates in the chat room. Developers type ACK, or “acknowledge”, to support a candidate or NACK to oppose one.
Bitcoin is the unit of account in a massive ledger of transactions called a blockchain. Identical copies of the 450-gigabyte database are stored on a network of tens of thousands of computers called nodes. An estimated 99per cent of nodes use some version of Bitcoin Core to record new transactions. Developers say Bitcoin Core’s ubiquity is in tension with the cryptocurrency’s goal of remaining decentralised, or free of control by any organisation or government. Other programs exist to operate a node in the bitcoin network, but experts say they lack the security and functionality of Bitcoin Core, which gets the most vetting.
Although the network rewards “miners” who devote computing power to validating transactions, bitcoin has no mechanism to compensate the developers who keep the software humming. Instead, crypto companies and wealthy investors pay to sponsor Bitcoin Core maintainers and other developers through grants.
Bound by reputation
The funding model raises questions of potential conflict of interest. “It comes up quite a bit – the source of the funding and whether there’s a kind of unseen control,” says Samuel Dobson, a former maintainer. Sponsors say one-year grants for maintainers range from $US100,000 to $US150,000. By comparison, Google lists salaries of around $US225,000 plus benefits, bonuses and stock – in job postings for mid-level engineers.
In US Securities and Exchange Commission filings, crypto exchange Coinbase Global has said the way developers are organised could limit bitcoin’s growth. Changes they make to the code could affect the network’s “speed, security, usability or value”, Coinbase told the SEC. There isn’t any public relations department for bitcoin that could respond to such concerns. Bitcoiners say their project isn’t governed by a formal organisation. Besides implementing changes the contributor team agrees should be made, Bitcoin Core’s website says, maintainers “act as a final check to ensure that patches are safe and in line with the project goals”. Bitcoin Core developers are bound by their reputations, Dobson says. Any maintainer who made harmful or unethical changes would likely suffer reputational damage and have their access revoked.
The downturn in crypto prices has bankrupted some firms that previously funded bitcoin software development, such as trading platform FTX and lender BlockFi, and has forced others to tighten their belts. Brink, a non-profit that takes donations and turns them into grants for three Bitcoin Core maintainers and other developers, has seen a 50 to 60 per cent drop in fundraising in the past year, executive director Mike Schmidt says.
The maintainers are scattered around the world, meeting in person once or twice a year at conferences. Most keep a low profile.
Hennadii Stepanov, who maintains the program’s graphical user interface, fled war-torn Ukraine for London in 2022, his sponsor says. Michael Ford handles the build system, meaning the process of translating or compiling source code to an executable program, occasionally posting photos of his parents’ farm in Australia. Gloria Zhao, a University of California grad, writes and reviews code governing bitcoin’s transaction-validation process.
The three are funded by renewable grants from Brink and work together at the non-profit’s office in the artsy Shoreditch neighbourhood of London. Schmidt says he checks in with grant recipients in monthly calls. “We specifically do not want to be dictating to them the types of things they’re working on,” Schmidt says. “That doesn’t mean we can’t introduce them to somebody or suggest a project that maybe they hadn’t heard of.”
Brink’s grant recipients have to reapply for their sponsorships each year. In weighing applications, the board tries to gauge a developer’s overall value to bitcoin, says Schmidt: “It’s very subjective.”
Chow, a University of Maryland graduate, oversees programming related to digital wallets that allow investors to store their bitcoin. Since his college graduation, he has been employed by Blockstream Corp. Maintainer Marco Falke focuses on testing and is funded by Okcoin USA, a crypto exchange founded in China, and investment firm Paradigm Operations. “We don’t necessarily view it as generosity,” says Jason Lau, Okcoin’s chief operating officer. “It truly is an investment in the foundations of our business.”
In an email exchange, Falke says he grew up in Germany and has been roaming Europe since leaving a job in New York in 2020. The location listed in his Twitter profile is Malmo, a city in southern Sweden. He declines to say where he currently lives.
Covert fixes
The group’s longest-serving member, Wladimir van der Laan, became the lead maintainer in 2014 but spent the past two years attempting to step back from this role. His profile on an archived website of the defunct Bitcoin Foundation suggests he was based in Amsterdam. Van der Laan was funded by the Massachusetts Institute of Technology’s Digital Currency Initiative. In August, van der Laan announced in the chat room that he would stop working as a maintainer. “I’m having burnout and health issues,” he said.“I just cannot do this anymore.” His access to Bitcoin Core’s GitHub repository was taken away at his request.
Of the current maintainers, only Falke and Chow agreed to comment for this article.
Some Bitcoin Core developers have grants from Block Inc, the digital-payments firm led by Twitter co-founder Jack Dorsey. He also set up a legal defence fund in early 2022 to help developers fend off potential litigation, such as a suit in the UK by a man seeking their assistance in recovering bitcoin allegedly stolen from him.
The process for addressing glitches in Bitcoin Core is delicate. To eliminate a vulnerability, most of the nodes in bitcoin’s network must proactively upgrade their software. If too much information gets out before that happens, attackers could be able to exploit the bug. “There have beennumerous covert fixes,” Chow says. Zhao, in a video posted on Okcoin’s website, says: “We’ve caught bugs all the time in (code) review that if it made it in, maybe there would have been something catastrophic happening to the network.”
Inflation bug
The closest call that has been publicly disclosed was on September 17, 2018. Bitcoin developer Matt Corallo identified a so-called inflation bug in Bitcoin Core that, if exploited, would have allowed attackers to spend the same bitcoin more than once. That would have undermined bitcoin’s key innovation compared with other forms of digital data that can be copied and pasted repeatedly. It helps ensure the scarcity that gives bitcoin its value in the eyes of investors.
After discovering the bug, Corallo sent an encrypted Signal message to the head of a major bitcoin mining coalition. But the problem he initially disclosed was a less serious “denial-of-service” bug.
The maintainers made a change to Bitcoin Core that included fixes to both issues and tried to alert users to update their software. Only after enough of the network had downloaded the update, three days later, did the maintainers issue a public description of the incident and the inflation bug. Samson Mow, a prominent crypto entrepreneur, said in a tweet last year that the inflation bug “could have killed bitcoin”.
Some bitcoiners say there should be much more transparency about such incidents. “It’s fine to have this small group of trusted people at the heart of the project,” says Michael Folkson, a bitcoin advocate who helps review the code. “But if they do something sneaky, like fix a bug within another change … once it comes out that the bug was fixed, I think they should be totally open about what the process was.”
Since bitcoin’s launch in 2009, 17 people have had access to change the code, according to a tally by Chow.
On its website, Bitcoin Core describes itself as “the direct descendant of the original bitcoin software” produced by Nakamoto. Before he or she disappeared in 2011, Nakamoto handed control of the code base to Massachusetts developer Gavin Andresen, an early enthusiast who had created a website called Bitcoin Faucet that gave away thousands of bitcoins to anyone who solved a captcha. His goal, he said, was to help the new form of money catch on. Andresen passed the role of lead maintainer to van der Laan in 2014. Two years later, van der Laan revoked Andresen’s access, alleging in a blog post that he had become a liability to the project.
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