Since Satoshi Nakamoto released Bitcoin, the software for it has been readily and freely available. Open-sourcing is an important element of the blockchain ethos and at the heart of what is envisaged for it as a decentralised, democratic, all-inclusive solution for a number of sectors.
However, much has changed in the blockchain and cryptocurrency space since January 2009 and Bitcoin’s launch. Blockchain has gone mainstream to the point where governments, banks, regulators and companies are all looking into its advantages, and are also seeking to utilise it for capitalist gain.
But this raises a number of questions. Should blockchain software be so openly available? And moreover, why is it so openly available, and what are the implications of it being an open-source piece of code? Conversely, if it were not open-source and openly available, what would that mean for the nature of blockchain technology and what it stands for? And what would it mean for those trying to harness this decentralised technology?
Being open-source offers the technology many advantages and has certainly shaped its ecosystem and helped drive its adoption and application, especially given that it’s such a disruptive form of tech. Nevertheless, there have been attempts to monopolise it, from patents to private chains – while the base code may still be openly available, the improvements are increasingly being made on proprietary software.
What Does it Mean to be Open-Source?
It’s important to understand what it means to be open-source. When one says that blockchain software is openly available, it usually means that the public blockchain technology can be used freely under an open-source licence. Open-source software is collaboratively produced, shared freely, published transparently and developed to be a community good, rather than the property or business of a single company or person.
“Open-source software is collaboratively produced, shared freely, published transparently and developed to be a community good, rather than the property or business of a single company or person. These principles… support the philosophical stance of blockchain”
These principles of open-source software support the philosophical stance of blockchain and the likes of Bitcoin – there is no one entity that makes, owns and sells the software, while the updates, improvements or other developments are undertaken by a community rather than a single company.
One of the most recognisable pieces of open-source software is Linux. It’s an operating system that is utilised a great deal more than many realise and has been able to spread and infiltrate the digital realm, thanks to its open-source nature. The numbers speak volumes: “Some 14,000 individual developers from over 1,300 different companies have contributed to the kernel,” the Linux Foundation reported in 2015.
Bitcoin Core is the product of more than 15,000 unique code contributions from over 450 unaffiliated developers. The software is available for free use and modification under the permissive MIT copyright license, and the full history of that development is visible within a public-software repository hosted by Github. Thus, it’s easy to draw the comparisons between Linux and this original blockchain.
“Bitcoin Core is the product of more than 15,000 unique code contributions from over 450 unaffiliated developers”
The difference with Bitcoin is that it has not only succeeded thanks to open source, but open source allowed it to birth an entire ecosystem. And, of course, no longer is it just Bitcoin alone – there are hundreds, if not thousands, of blockchains out there spawned from Satoshi’s original code.
Why Open Source is at the Heart of Blockchain
Because Satoshi decided to make blockchain openly available, and open source, he allowed many different blockchains to form. Special mention goes to Ethereum, which has fueled the ICO boom of the past couple of years, as its blockchain is both useful and easy to replicate.
However, there was really no other way Satoshi could have started the blockchain revolution. Open source is at the heart of the technology. The blockchain, as the base for Bitcoin, was created for much more than just money-making; it was intended to offer financial freedom.
It’s a trustless technology that, ironically, is made in such a way as to instil trust. There are no banks or other institutions that need to be trusted – only the code. But therein lies the crux: if the code was not open source, it would not be trustworthy because, essentially, those utilising the technology would be trusting just one company’s developers.
“If the code was not open source, it would not be trustworthy [as you] would be trusting just one company’s developers. This wrecks the decentralised nature of blockchain… [and] the democratic nature of blockchain governance also becomes highly questionable”
This wrecks the decentralised nature of blockchain. If those working on the underlying technology are all grouped under one umbrella, it can be shaped and moulded and, once again, the democratic nature of blockchain governance also becomes highly questionable.
Its open-source nature has allowed for it to be built on democratically, so any changes needed are made at the behest of the majority of its users, and innovation and experimentation are at the forefront. If a change is suggested that could drive the blockchain forward, it can be taken up. Just as easily, though, it can be rejected by the democratic decision of the users.
Private vs Public Blockchains
While the nature of blockchain is open, trustless and decentralised, there have been pushes by companies, individuals and other entities in recent times to try to capture the technology and make it their own.
Public blockchains such as Ethereum and Bitcoin are, by their nature, open-source and decentralised, but there is the possibility of private blockchains, and these are increasingly entering the ecosystem. Private blockchains are created for the use of a specific entity and are typically closed source. The primary reason for their emergence is the efficiency gained by having full control.
“Private blockchains are created for the use of a specific entity and are typically closed source… [XRP] is using it in partnerships with banks to try to monopolise the market. This is a radical change to the founding ethos of blockchain technology”
One of the top-rated cryptocurrencies by market cap is XRP, developed by Ripple Labs. XRP is a private blockchain that, instead of embracing decentralization and open source, has instead taken control of the blockchain and is using it in partnerships with banks to try to monopolise the market. This is a radical change to the founding ethos of blockchain technology.
Patenting the Blockchain
There are even instances where companies and individuals are trying to patent blockchain ideas. Not only are they an attempt to gain control of intellectual property on proprietary software, but also to protect themselves from other corporations that are looking to take out the entire market with their own powerful monopolies.
Keir Finlow-Bates, CEO of Chainfrog, spoke to Binary District Journal about his own patents, and how others such as Microsoft and Mastercard are piling on blockchain patents, making the space a little less openly available. “It’s a very complicated ecosystem and a lot of major companies are entering the waters,” he explained. “But there are also many innovative and less constrained startups that can come up with more radical uses for blockchain and turn them around quicker without the usual red tape required in these corporations.”
“The world has woken up and there are now major players trying to stake out different areas in the ecosystem. That’s why it’s good for startups to have patents to protect their intellectual property”
“The world has woken up and there are now major players trying to stake out different areas in the ecosystem. That’s why it’s good for startups to have patents to protect their intellectual property,” he added.
A Change in the Air?
Blockchain is an evolving technology and a fast-evolving one at that. It began life as a bid for financial freedom, but as it’s gained mainstream attention, it has, predictably, also been subject to global capitalist scrutiny.
People across the world are recognising and appreciating the potential of blockchain technology, and because of that, are looking to exploit and make money from it. In its current form, as an open-source piece of code, there is little ability to control or profit from it. However, perhaps its days of unrestricted availability are numbered.
As well as Linux, there are many other widely used products that were developed at least in part by open-source projects. Perhaps the most popular and well-known is Android, the world’s most popular smartphone OS by a distance. It allows developers to tweak and adjust the underlying OS to suit a range of different hardware manufacturers, a markedly different approach to Apple’s ‘walled garden’.
Another household name that has benefitted from open-source is Google Chrome. The web browser itself is not open-source, but it was built on top of an open-source project called Chromium. This means that users can contribute code and bug reports, even fixing major bugs in some cases. Then, because Google Chrome is controlled by Google, the giant can choose whether or not to take the code and apply it to the main product. In theory, anyone could take Chromium and build a product with whatever adjustments they like, such is the power of open-source projects, particularly in high-profile organisations.
Illustrations by Kseniya Forbender
To contact the editor responsible for this story:
Margarita Khartanovich at [email protected]
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