Jack Dorsey, co-founder of Twitter and Square, recently formed the Bitcoin Legal Defense Fund to help fight against the freezing of open source software development as a result of a lawsuit. Formerly known as Craig Wright, an Australian computer scientist, and now unknown as Satoshi Nakamoto, he has filed a legal action attempting to lay claim to approximately $5 billion worth of Bitcoin.
The legal battle arises from an incident in 2021 in which Wright claims to have lost access to his private keys, containing 111,000 Bitcoins. As a result, he blames 11 Bitcoin Core developers for being responsible for his financial losses. The suit was initially dismissed, but this ruling was overturned in March 2021 by Lord Justice Birss.
In response, the Bitcoin Legal Defense Fund, led by Dorsey, Block’s Head of Litigation Martin White, and Chaincode Labs Co-Founder Alex Morcos, set up a not-for-profit organization to protect Bitcoin developers from litigation. The founders wrote a letter explaining their motive, stating that developers, who often work independently, are most vulnerable to legal pressure and need a defense against such obstacles. This was strengthened further in January by the addition of Chief Legal Officer Jess Jonas.
Open source software development has seen its fair share of legal struggles over the past couple of years. The Cyber Resilience Act proposed by the EU could have a chilling effect on the development of open-source projects, due to developers being held legally liable for any security issues that may arise from their software. Similarly, the upcoming EU AI Act could limit the freedoms of general purpose AI systems, resulting in a significant power shift to larger tech companies.
Many of these legal blows worry the Bitcoin users, who share a vested interest maintaining the decentralization of this project. As a result of Wright’s lawsuit, the developers may face a fiduciary duty to the owners of the project’s property which can potentially destroy the MIT License that was allowed to Bitcoin. This would mean a great deal of trouble for developers of open source projects, who are often quietly try to better humanity.
In early April 2021, 11 of the 16 defendants were supported by the Bitcoin Legal Defense Fund and the group made their first filed defense. This case centers around whether there should be a “backdoor” to the private keys in order to serve third parties, with the defense looking to confirm MIT License as a secure method of protect open source software. Jonas commented later on the matter stating that the Fund “fights not just for Bitcoin but also the right of open-source developers to create and freely share their code with the world for the greater good”.
As a key player in tech and finance, Dorsey is certainly a figurehead for the future of open source software. With the Bitcoin Legal Defense Fund, he is certainly sending a message to those attempting to freeze such development – the future of software is in the hand of developers.
