Peer Production on the Crypto Commons

Version 0.8

Toward a Commons Based Economy

Blockchain Development Funding

Miners are handsomely rewarded for the role they play in securing the network. Merchants have built a business which relies on the network to function. Users avail of the service the network provides (or hold their coins in speculation that they will increase in value as more people wish to obtain them and use the service the network provides in future).

The motivations of the engineers who produce the software the network runs on are not as clear. Developers may be (and most likely are) intrinsically motivated to participate, in the same way that they typically are with other FOSS projects. Blockchain projects also have the capacity to fund development in some ways which are familiar from other FOSS domains (Software as a Service, patronage, and donations), and some which are unique to the cryptocurrency space (appreciation of holdings, ICOs, block reward funding).

The centrality of the software to the blockchain means that developers will always tend to have some influence over the course its development takes, but the nature and degree of this influence vary significantly between projects. The sense of being part of the team which is facilitating and steering the course of a blockchain’s development is likely a big incentive for participation, irrespective of whether and how that participation is compensated.

2019-10-31: An analysis of developer funding in Bitcoin published by Derek Hsue, Su Zhu, Hasu, & Brandon Curtis. This essay makes some of the same points as the following sections, with more detail and focus on Bitcoin’s history.

Last updated on 10 Sep 2019
Published on 10 Sep 2019
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