Aaron van Wirdum traces Bitcoin’s cypherpunk roots

Bitcoin didn’t drop from the sky – but you’d be forgiven for thinking it did. A mysterious creator, an email list of privacy radicals, and an obscure economic vision all collided to create the world’s first unstoppable digital money.

That was the story shared by Bitcoin historian Aaron van Wirdum at the Bitcoin Oasis panel in Dubai, where he traced the currency’s philosophical and technological roots.

Austrian roots

Bitcoin’s economic DNA can be traced to the ideas of Friedrich Hayek, a Nobel Prize-winning economist known for his critiques of centralized planning. “Throughout basically the whole 20th century, he was writing about money from a bottom-up perspective,” van Wirdum explained.

Hayek argued that rather than governments issuing money and controlling its value, the market itself should decide what money is and how it works.

This idea may have sounded fringe at the time, but by the 1990s, Hayek was clear: central banks couldn’t be trusted to act impartially, and the only real solution was to develop a monetary system they couldn’t control. “He figured that realistically, the only way to make it happen is to create a form of free market money that the government cannot stop.”

That thinking resonated with early internet pioneers who believed new technology could disrupt not just how we communicate, but how we store and exchange value.

The cypherpunks

Around the same time, another community was forming – one less concerned with economics than with personal privacy in the digital age. The cypherpunks were a loose group of computer scientists, cryptographers, and idealists who gathered on an email mailing list to exchange ideas, code, and manifestos.

“They saw the internet as a potential dystopia, basically like this 1984 Orwellian type of world, and they wanted to prevent that,” van Wirdum said. The tools they built were meant to give individuals control over their data and identities: strong encryption for messages, anonymous remailers, and early attempts at digital cash.

“If the internet becomes such an important part of everyone's life, but we don't build it in such a way that we protect people's privacy... every payment you make can be monitored, tracked, traced, and potentially used against you.”

The idea of digital cash wasn’t new. In the late 1980s and early 90s, David Chaum’s DigiCash project attempted to create anonymous online payments backed by banks. It failed commercially, but it inspired a generation of cryptographers who wanted something even more radical – money without banks at all.

Bitcoin’s blueprint

“There’s still sort of this misconception sometimes that Bitcoin... came out of nowhere,” van Wirdum said. “There was nothing, and then one day Satoshi came from the heavens, and he dropped Bitcoin on Earth.”

In reality, Bitcoin was the synthesis of a decade’s worth of failed or unfinished experiments. Hashcash, created by Adam Back in the late 1990s, introduced proof-of-work as a way to combat spam emails – a concept Satoshi would later use to secure the Bitcoin network.

B-money, proposed by Wei Dai in 1998, imagined a decentralized ledger run by anonymous participants. Nick Szabo’s Bit Gold brought in timestamping and the idea of provable scarcity.

“Satoshi didn’t invent many new technologies. He just put existing technology together in a novel way,” van Wirdum explained.

That “novel way” was more than just clever coding. It involved solving the long-standing problem of trust in digital payments without relying on a central party.

By combining proof-of-work, peer-to-peer networking, and incentives in the form of bitcoin rewards, Satoshi created the first digital currency that could operate independently of banks, governments, or corporations.

Crypto wars and resistance

Cypherpunks built encryption tools to resist surveillance and laid the groundwork for Bitcoin’s decentralized design. Photo: Wikimedia Commons / Mutante

The path to Bitcoin wasn’t just intellectual – it was political. The cypherpunks had to defend their tools from government efforts to control them. In the 1990s, the U.S. government launched the “clipper chip,” a hardware backdoor that would give the NSA access to all encrypted communications.

The response from the cryptographic community was defiant. Podcaster Stephan Livera recalled how developers like Adam Back turned protest into fashion, printing encryption code on T-shirts and mailing them abroad to defy government restrictions.

Cryptography, once the domain of military intelligence, became a civil liberties issue – and cypherpunks saw themselves as fighting for the future of the internet.

Bitcoin’s launch in 2009 came on the heels of the global financial crisis. For many, it felt like a response: a currency immune to bailouts, inflation, or central bank policy. Its release email was sent to the same cypherpunk mailing list where many of these earlier ideas had been discussed for years.

Freedom by design

Bitcoin represents more than just a new form of money. It’s a system built to resist censorship, surveillance, and manipulation – an embodiment of both economic and technological rebellion.

As van Wirdum put it, Bitcoin is the result of decades of thinking about “how we can create a form of free market money that the government cannot stop.”

From Hayek’s free-market theory to cypherpunk code, Bitcoin emerged from the belief that individuals should have sovereignty over their data, their communication – and their money.

Its continued relevance speaks to the fact that these battles are far from over. As governments around the world explore central bank digital currencies (CBDCs) and increase financial surveillance, Bitcoin stands as a reminder of what a radically different system can look like.