Bitcoin’s Future Depends On A Handful of Mysterious Coders

Developers with power to change the cryptocurrency’s software hold an unorthodox role, are elusive—and have been known to head off disaster for the coin. Bitcoin’s Future Depends On A Handful of Mysterious Coders

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.

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Seven years later, Mr. Chow is one of a handful of people who can write changes into the software that underpins the nearly $500 billion 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 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 spring, along with $2 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% of the value of the whole cryptocurrency market for years.

Bitcoin’s current worth and future potential rest partly in the hands of the Bitcoin Core maintainers, a group who are chosen by their peers and are 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.

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 like 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, said Jameson Lopp, a bitcoin expert and privacy advocate 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, software developers would be organized into an established hierarchy, with managers, job descriptions and performance reviews. If it were publicly traded, investors would receive standardized disclosures about its finances, 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 Corp.-owned website where Bitcoin Core is stored. Maintainers and other software 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 from other developers 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 summer as Mr. Chow live-streamed his coding work on Twitch, something he does every Monday at 2 p.m.

“It can be very scary,” Mr. Chow replied, his screen filled with lines of code against a black background. “But, like, 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 ad hoc 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 99% of nodes use some version of Bitcoin Core to record new transactions.

Developers say that Bitcoin Core’s ubiquity is in tension with the cryptocurrency’s goal of remaining decentralized, or free of control by any organization 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 key developers, through grants.

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,” said Samuel Dobson, a former maintainer.

Sponsors say one-year grants for bitcoin maintainers range from $100,000 to $150,000. By comparison, Alphabet’s Google lists salaries around $225,000—plus benefits, bonuses and stock—in job postings for midlevel engineers.

Bitcoin’s Future Depends On A Handful of Mysterious Coders

In SEC filings, crypto exchange Coinbase Global Inc. has said that the way developers are organized 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 organization. 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, Mr. Dobson said. Any maintainer who made harmful or unethical changes would likely suffer reputational damage and have his or her access revoked by other maintainers, he said.

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 nonprofit that takes donations and turns them into grants for three Bitcoin Core maintainers and several other developers, has seen a 50% to 60% drop in fundraising over the past year, said Brink Executive Director Mike Schmidt.

The maintainers are scattered around the world, meeting in person once or twice a year at bitcoin 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 said. 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 Western Australia. Gloria Zhao, a University of California, Berkeley, 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 nonprofit’s office in the artsy Shoreditch neighborhood of London. Mr. Schmidt said 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,” the Brink executive director said. “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, said Mr. Schmidt: “It’s very subjective.”

Mr. 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 Corporation Inc., a financial-infrastructure firm.

Maintainer Marco Falke focuses on testing and is funded by Okcoin USA Inc., a crypto exchange founded in China, and investment firm Paradigm Operations LP.

“We don’t necessarily view it as generosity,” said Jason Lau, Okcoin’s chief operating officer. “It truly is an investment in the foundations of our business.”

In an email exchange, Mr. Falke said he grew up in Germany and has been roaming Europe since leaving a job in New York City in 2020. The location listed in his Twitter profile is Malmö, a city in southern Sweden. He declined to say where he currently lives.

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.

Mr. van der Laan was funded by the Massachusetts Institute of Technology’s Digital Currency Initiative, where Securities and Exchange Commission Chair Gary Gensler worked as an adviser before being nominated by President Biden.

In August, Mr. van der Laan announced in the chat room that he would stop working as a maintainer altogether. “I’m having burnout and health issues,” he said. “I just cannot do this anymore.” His access to Bitcoin Core’s GitHub repository was finally taken away on Thursday, at his own request.

Of the current maintainers, only Messrs. Falke and Chow agreed to comment for this article. Some didn’t respond to requests for comment, nor did Mr. van der Laan.

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-defense fund in early 2022 to help developers fend off potential litigation, such as a suit in the U.K. by a man seeking their assistance in recovering bitcoin allegedly stolen from him.

Bitcoin’s Future Depends On A Handful of Mysterious Coders

The process for addressing glitches in Bitcoin Core is delicate. To eliminate a vulnerability, a majority of the nodes in bitcoin’s network must proactively upgrade their software. If too much information gets out before that happens, however, attackers could be able to exploit the bug.

“There have been numerous covert fixes,” Mr. Chow said in a phone interview.

Ms. Zhao, in a video posted on Okcoin’s website, said: “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.”

The closest call that has been publicly disclosed was on Sept. 17, 2018. Longtime 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 inflation bug, Mr. 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,” said 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 Mr. 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.

Bitcoin’s Future Depends On A Handful of Mysterious Coders

Mr. Andresen passed the role of lead maintainer to Mr. van der Laan in 2014. Two years later, Mr. van der Laan revoked Mr. Andresen’s access, alleging in a blog post that he had become a liability to the project. Mr. Andresen didn’t respond to an email requesting comment but has previously said that remarks he once made that apparently fueled Mr. van der Laan’s concern were misplaced.

Mr. van der Laan said in early 2021 that he planned to exit the role of lead maintainer. In August he announced in the chat room that he would stop working as a maintainer altogether. “I’m having burnout and health issues,” he said. “I just cannot do this anymore.”

A conversation about succession turned heated last June, after Mr. Ford, already a maintainer, nominated Ms. Zhao to the role. Jeremy Rubin, a prominent bitcoin developer, suggested the group draft a job description first.

“No, I don’t think adding more bureaucracy and formality makes things better,” Mr. van der Laan said.

“You’re avoiding important discourse on accountability of maintainers,” Mr. Rubin shot back.

Despite the prestige of working on the world’s biggest cryptocurrency, a recurring joke among maintainers is that no one really wants the job.

After Mr. Dobson announced in December 2021 that he would be stepping aside from the maintainer role to focus on his doctorate, Mr. Falke declared that the next person to say something in the chat would be the replacement.

Bitcoin’s Future Depends On A Handful of Mysterious Coders

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