I’m grateful that Chaincode doesn’t have an open grant process. It’s an enormous time investment to do well. Square Crypto, BitMEX, OKCoin, Gemini and others should be lauded for their financial contributions back to the ecosystem. But after convincing the higher-ups that grants are a good idea, the real heroes dig in to read all those applications and talk with dozens of candidates. Over this couple of years, it’s been a thrill to see an uptick in dev funding. I’ve witnessed life-changing grants that allow developers and researchers to turn 100% of their attention to Bitcoin development. That trend seems to be accelerating with more individuals and bitcoin businesses recognizing the importance of supporting the devs that secure our Bitcoin future. In fact, when I first wrote this in the fall of 2020, finding funding for all the qualified devs was an issue. Now (December 2021), there is an excess of money without enough quality devs.
Bitcoin is not a finished product. It has worked so far, but there have been some close calls. Being able to save Bitcoin from future failures (which may already be in the wild) and continue to add features to increase the underlying asset’s value requires developers with expertise and context. In a crisis, I’d wager the community would pay up for the best mercenary programmers on the planet to rescue us. But that’s unlikely to work in such a fragile backward-compatible system. Even the best programmers may do more harm than good without context, and that familiarity with where the dragons lay is hard-earned over years. The project’s future health depends on finding and retaining the devs willing to toil in obscurity, acquiring the necessary experience to make meaningful contributions. Part of that retention is financially supporting said devs.
The narrative around businesses or individuals need to give back remains difficult to articulate. There is a vague feeling that businesses making money off the protocol should give back. But writing no-string-attached checks to at-large devs doesn’t fit neatly into an incentive-based system like Bitcoin. Some long-time code contributors likely have some bitcoin holdings giving them a vested interest in protecting their holdings. But given the natural dev turnover, relying on developer goodwill doesn’t seem sustainable.
In general, dev funding for open-source projects is far from a solved problem. The Cathedral and the Bizarre paints an optimistic picture of open-source development, but time has revealed that this hasn’t quite come to fruition. Bitcoin isn’t alone in this problem. Bitcoin, however, is money. You’d imagine there is enough surplus from this great wealth transfer to help fund the infrastructure development on which this ecosystem is built. While the immaculate conception created the fairest distribution possible, we can only hope that the beneficiaries feel the weight of their responsibility towards those who weren’t as prescient.
Most of my conversations about funding Bitcoin devs often focus on the present need rather than systemic ways to make long term contributions sustainable. At present, we heavily rely on the goodwill of a few and good ole fashion guilt to fund a couple of dozen active contributors. The alternative has also been tried, but that didn’t work out so hot either. (Note: there was an attempt to resurrect the Bitcoin Foundation in 2018. If interested, the effort yielded a deck for friends of the foundation and a new marketing strategy.)
Who to give to?
Finding who to give to is a more nuanced problem than finding the money. It’s an enormous undertaking to find deserving candidates. Because Bitcoin has no central foundation or trusted center, we don’t have a great system for those looking to simply write a check rather than diving deep into the project’s commit history. (See post on Bitcoin 501(c)(3)s) There are a few approaches that have seemed to work:
- Give to an organization: Whatever your opinion on MIT DCI, HRF, or Brink once you write the check, you can feel good and let someone else worry about who to give it to. These are tax-deductible too. Alternatively, given the excess of donors right now and the lack of quality devs, maybe consider education programs like Qala. (Disclosure: I work in education and Qala)
- Hire a superhero: Square Crypto is giving out a lot of grants. Steve Lee is everywhere and knows everyone. If you are building something like a Square Crypto or launching a $500K+ grant program and you can find one of those people that can manage the process, your job just got a lot easier. BitMEX went this route, and I think the results were pretty good.
- Ask other contributors: Assembling a committee of active contributors giving them the chance to review candidates is a good idea. They will know more than you. Coinbase did this and I think this works if you are a company considering a grant or hiring an open-source contributor to be on staff (see NYDIG), but it’s also appropriate for an individual. People in the code know what’s going on.
The main pitfall of these approaches for funders is that it still takes work to find people or orgs aligned with how you’d want the money to be distributed. Finding people who know the landscape is difficult, and then you still have to trust that they will sniff out the deserving parties.
Another option is sprinkling money around through crowdfunding like bitcoindevlist. This sounds great in theory, but I worry that donations follow a power-law of already-fundable candidates or attention-seeking personalities attracting disproportionate support. (I once heard the suggestion that those fundees could then distribute their surplus to deserving candidates, which I’m skeptical of, but would love to see in the wild.) It’s seductive to fall into the trap of measuring value with quantitative metrics like the number of lines of code/commits/pull requests, a single well-known contribution, or twitter follower count. Unfortunately, these can measure the wrong things and can lead to misguided conclusions. Optimizing for mentorship, peer collaboration, in-depth review, work ethic, integrity, or wisdom is hard to capture with KPIs. Even so, grassroots funding will always be the most decentralized path. And so, while I haven’t seen examples of its sustainability to date, I hope
with the next bull run to be proved wrong.
Funding matters and the fact that you are interested enough to get to this point in the post reflects who you are and your investment in helping Bitcoin. Thank you for caring so deeply. Let me know if I can be helpful.
(Edited and updated December 2021)