Claudio Koller · 3/9/2023

The Emergence of Cypherpunks and Bitcoin

Many people don't realize how often the work of cypherpunks is in our daily lives. Whether we're going shopping and paying with our card, or having a cozy evening with Netflix. Virtually every interaction with technology and digital devices involves important cornerstones laid by the Cypherpunks.

Who were the Cypherpunks?

The Cypherpunks were a group of people who came together in the late1980s and advocated the use of cryptography to promote privacy and freedom on the Internet. They pioneered the development of various encrypted communication protocols and the cryptocurrency bitcoin, among others.

Emergence of the Cypherpunks

Until around the 1970s, cryptography was mainly practiced by military and espionage departments. The technical roots of Cypherpunk ideas can be traced back to work by cryptographer David Chaum on topics such as anonymous digital cash and pseudonymous reputation systems.

In the late 1980s, the first ideas developed into a movement of sorts. In 1992, Eric Hughes, Timothy C. May, and John Gilmore held regular meetings in a smaller group in California. This is when the name «Cypherpunk» was born. The name is formed from the terms cipher, cyber and punk.

Principles of the Cypherpunks

The Cypherpunks discussed the digital revolution and its impact on the freedom of the individual early on. They realized early on that mass surveillance could become a big problem in the digital age. The only hope of protecting one's privacy lay in cryptography. Subsequently, a social movement around encryption emerged.

The basic principles are privacy in communication and data storage. In addition, the cypherpunks rejected government and police censorship and surveillance. These goals were to be realized through cryptography (ancient Greek: crypto for «hidden», «secret» and graphie for »writing», «script»). Most of the principles were later written down in Cypherpunk's Manifesto by Eric Hughes (1993).

Crypto Anarchist Manifesto

Timothy C. May, computer engineer and senior scientist at Intel, published in 1988 the manifesto - the «Crypto Anarchsist Manifesto», which prophesied the transformation of the relationship between citizen and state by technological progress.

Just as the technology of printing changed and reduced the power of medieval guilds and the social power structure, so too will cryptologic methods, fundamentally change the nature of business and government interference in economic transactions.

Crypto Anarchist Manifesto (Timothy C. May, 1988)

Goals of the Cypherpunks

Cypherpunks are politically close to libertarianism and call for the disclosure of public knowledge (knowledge about society, politics, economics, science) and the concealment of private knowledge. This ideal is strongly supported by data protectionists, but often leads to a conflict of interest with the state.

Privacy is necessary for an open society in the electronic age. ... We cannot expect governments, corporations, or other large, faceless organizations to grant us privacy ... We have to defend our own privacy, if we want to have any at all. ... Cypherpunks write code. We know that someone has to write privacy software, and ... we will write it.

A Cypherpunk's Manifesto (Eric Hughes, 1993)

Cypherpunk Mailing List

They eventually kept a mailing list where they exchanged ideas and visions with each other. Well-known personalities, such as Julian Assange, the founder of WikiLeaks, «Proof-of-Work» inventor Adam Back, and Hal Finney, who received the first bitcoin transaction, joined the mailing list.

It doesn't matter if you have nothing to hide. Because privacy is not about hiding. It's about protecting a free and open society. It's about protecting the right to be free, independent, different and individual.

Edward Snowden

Bitcoin Whitepaper

Two decades later, after Tim C. May wrote the Crypto-Anarchist Manifesto, Satoshi Nakamoto published the bitcoin Whitepaper on October 31, 2008. He published the concept on the aforementioned Cypherpunks mailing list. With it he realized a digital means of payment for the whole society, independent from states.

I have developed a new open source P2P e-cash system called bitcoin. It is fully decentralized, with no central server or trusted parties, as everything is based on cryptographic proof instead of trust.

Satoshi Nakamoto, February 11, 2009

> Learn more about Bitcoin Whitepaper.

Previous Concepts for Digital Cash

Previously, there were some concepts for a digital cash, such as Wei Dai's B-Money or Nick Szabo's BitGold. However, they all failed to solve the double-spending problem. Although these pioneers were not successful in the end, they laid an important foundation for bitcoin.

Wei Dai and Adam Back, who invented Proof-of-Work, were the first two people contacted by Satoshi Nakamoto when he developed bitcoin in 2008. Both individuals were referenced in the bitcoin whitepaper.


Bitcoin and the cypherpunk movement are closely linked. The decentralized nature of bitcoin, as well as its ability to enable censorship-resistant transactions, align with the Cypherpunks' goals of promoting individual freedom and privacy in a digital world.

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