When Neuromancer was originally published in 1982 we couldn’t even get our heads around what a web browser was.Cyberpunk in the 1990s was all techno music and wild hair, squat parties and bad video art.Cypherpunk, by contrast was RSA, PGP and the NSA.Now, it’s BTC, GCHQ, PRISM, SHA-256, TEMPORA and RAGTIME-P (Stellar Wind).It’s a world full of acronyms and codes, impenetrable to all but the most cynical, distrustful, and political of minds.The Cypherpunks began properly in 1992 when Tim May, Eric Hughes and John Gilmore, started the Cypherpunks’ mailing list.But Jim Bell, David Chaum, Phil Zimmerman, Julian Assange, Adam Back, Wei-Dai and Hal Finney are just a few of the ciphers on the mailing list who are just now becoming luminaries, because they’ve all contributed something so uniquely valuable to us through their efforts to protect our privacy in the new information economy, particularly against the encroaching financial surveillance complex (typified by FATCA).Other names, like Tim-Berners Lee, John Perry Barlow and Nick Szabo also feature in this essay, as ‘Cypherpunks by proxy’ because of their contributions and their philosophy.

Tim May’s seminal 1992 document ‘The Crypto-Anarchist Manifesto‘ states: In 1993 Eric Hughes wrote his original statement on the mission and goal of the Cypherpunks called ‘ A Cypherpunk’s Manifesto‘, in which he says: May also went on to write ’The Cyphernomicon‘ which was later echoed by Neal Stevenson’s historical fiction entitled “Cryptonomicon” in which “[a] narrative is set in the late 1990s with characters […] employing cryptologic, telecom and computer technology to build an underground data haven […].Their goal is to facilitate anonymous Internet banking using electronic money and (later) digital gold currency”.David Chaum was the most notable early champion of the Cypherpunks’ goal of realising a digital currency in ‘Digicash’.In some ways, Digicash was a spectacular failure, sometimes unfairly attributed to Chaum’s greed; but in the best ways, its failure was instructive because it demonstrated perfectly that a privately issued digital currency could not survive the legal system’s onslaught of regulations (AML and KYC in particular).

Exactly the same story has been seen being played out again and again, with e-gold’s failure, whose CEO Douglas Jackson narrowly avoided being sent to jail, and more recently with the Liberty Reserve Dollar and Arthur Budovsky‘s arrest.Whilst the dollar is backed mostly by political force (the threat of forgery protected by imprisonment or violence), legitimate banks can manipulate the international money markets by devaluing their currency.bitcoin billionaire wikiThe rules that apply to banks, also apply to the privately issued currencies like those mentioned above, and they must all be highly regulated.linux bitcoin miner gpuThey must do due diligence on their customers and follow rules like: ‘Know Your Customer’ where they must be able to verify the true identity of their clients, and they must keep records of what their customers are buying and selling with their digital tokens.bitcoin vinden

Recently we’ve been informed about the US government’s use of FISA, the ‘Foreign Intelligence Surveillance Act’ of 1978 (amended much since 9/11) which effectively enables the US government to make requests for information about a private company’s data.In the UK, it’s RIPA (Regulation of Investigatory Powers 2000) that enables this process.Using FISA or RIPA, our governments can lay claim to the most sensitive of private data, from meta-data about calls and communication to the KYC databases.Understandably, governments don’t like this, and they’re desperately trying to find ways to regulate (or at least classify) it.In April 2013 a study from the university of Chicago released a document which concerned how the IMF could potentially address the threat that Bitcoin now poses to the global economy in its capacity to launch speculative attacks on national currencies.The technicality is that they (the IMF) cannot buy Bitcoins because it is a stateless currency, and according to their articles of association they can only hold reserves of state-backed currencies.

This is a dilemma for the IMF, and puts them directly at odds with the Cypherpunks’ politics, which is precisely the point.Perhaps John Perry Barlow’s words, keeping with the spirit of independence akin to the founding fathers of the US, put it best in his now famous ‘Declaration of the Independence of Cyberspace’ when he stated: For those wary of Bitcoin’s pedigree, it may comfort them to know that it emerged directly from a culture of programmers who champion open-source software (also known as free software) like Sir Tim-Berners Lee, who invented the World Wide Web.The ‘shadowy hacker’ label that is sometimes ascribed to Satoshi Nakamoto is fair in some ways because that’s the way he intended it.Satoshi thus embodies all the things that the original Cypherpunks were trying so hard to impress upon us: our fundamental right to privacy.It is Bitcoin’s capacity to protect some aspects of our privacy from GCHQ and the NSA that makes it valuable – to a degree.But it’s more than that.

Bitcoin has high utility, and gains some value from its scarcity, but more from its inherently democratic and ethical design.To make things clearer, the cryptographic roots of Bitcoin stem from the legacy of Ron Rivest, Adi Shamir and Leonard Adelman who pioneered the RSA algorithm (the first commercially available cryptographic algorithm) in 1977, and Whitfield Diffie and Marty Hellman’s ingenious invention of ‘Public Private Key Cryptography‘ in 1976, a method now used in everything from PGP email (now more commonly used in GnuPG) to the Bitcoin network protocol.Both of these cryptographic innovations were closely watched by NSA who initially classified them as threats to national security and therefore as munitions, but they eventually gave up trying to contain them in the late 1990s and early 2000s when both RSA and the Diffie-Hellman-Merkle key exchange were finally and terminally released into the public domain.There was however, one final, and brilliant solution to the problem of ‘double spending’ which made the whole system viable.

Double spending was a problem that had plagued digital cash since its inception: the solution came in the form of Hal Finney’s concept of ‘Reusable Proofs of Work’ based on Adam Back’s invention in 1997 of Hashcash; originally a “proof-of-work system designed to limit email spam and denial of service attacks”, in combination with Dahlia Malkhi and Michael Reiter’s academic work on ‘Byzantine Quorum Systems’.RPOWs (as they came to be known) really came into their own and did away entirely with the need for a central time stamping server that could be compromised by crooks wanting to re-spend their digital cash over and over again.Satoshi explained how RPOW’s could be used to solve the Byzantine General’s Problem, a problem in general computing that demonstrates through game theory how a group of potential co-operators can come to the best consensus even with the possibility of having defectors in their midst.His explanation for how proof of work can be used to eliminate the need for a trusted third party is here.

Hal Finney responded to Satoshi on his original posting of the Bitcoin whitepaper on the cryptography mailing list at Metzdowd; he was also a keen observer of Wei-Dai’s original post on /b/money which begins: Dai goes on to outline the original idea for Bitcoin which is then fleshed out fully by Nick Szabo in his article ‘Bitgold’, published in 1995 and then republished again on his blog ‘Unenumerated – Bit Gold’ in 2008 where he fully articulates Dai’s idea.It is Szabo’s writings that are crucial to the intellectual development of Bitcoin and digital property rights in general.(If you enjoy this article, or find it useful for your research, please consider donating BTC to 1AU8WhY6RHRYcr7heCNfj5YGHTELFkBQNP Thanks!)As ours is a distinctly post-religious culture, like V from ‘V for Vendetta‘, Satoshi emerges from the darkness of the digital underground to lead the masses in a brave new world against the banks, oligarchs and multinationals; all who benefit from our ignorance about the nature of money, our powerlessness over entrenched state monopolies and our obedience to the collusion of government and big-business.