The Shadow Brokers Want Us To Crown Them Kings

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Shadow Brokers

A hacker called The Shadow Brokers claims to have hacked the NSA. The leak includes what the Shadow Brokers claim to be exploits and malware from the infamous NSA-funded hacking firm the Equation Group.

The leak has not been confirmed by a reputable security firm. Early indications are that it is legit. Individual security experts that have spoken to media outlets, including Motherboard Vice and The Daily Dot, have said as much. The Shadow Broker’s Tumblr page appears to be down currently. A cached version of the page remains on Google.

But that is not all. The Shadow Brokers are true to their namesake and are attempting to sell the rest of the information and software that they have.  The payment model is convoluted. They say the best of their information will be sold to the highest bidder, but there is a catch. Bids are placed by sending bitcoin to their bitcoin address. If someone bids higher, they keep your money anyway.

In addition, there is another trove of information and software that they plan to release if their address receives a total of 1 million bitcoins. Not 1 million dollars in bitcoins, but 1 million full bitcoins, currently worth about 567 million US dollars. It is also about 1/21 of all the bitcoins in the world.

That is a high price to pay to find out what the NSA has been doing to and with our private communications. I’m not entirely sure how I feel about it. Their initial leak is valuable in its own right, and I didn’t expect every whistle blower in history to be as virtuous as Edward Snowden. I’m not surprised someone demanded money for information. I am surprised they asked for so much.

If we had a choice, I’d say that the Bitcoin community shouldn’t pay this ransom. 1/21 of all bitcoins in existence are much more valuable than their exchange rate, at least to us. If our goal is to make a new crypto economy, then The Shadow Brokers will become the new elites of that economy. It isn’t that I don’t want to have the information revealed, I do, but I don’t want to make The Shadow Brokers the elites of our economy. Maybe they will dump it all and depress the price, or maybe they will hold on to it and become one of the riches entities in the world if Bitcoin tops a million dollars.

It isn’t up to us. The free market will decide if The Shadow Broker’s promise of information is worth a half a billion dollars. Even if we all pledged not to pay it, that won’t stop an outside group, maybe even the NSA themselves, from buying however much bitcoin they can and using it to secure the information for themselves.

The Shadow Brokers decry the wealthy elites, but are asking us to make them a part of that class.

The Shadow Brokers Are Only The Beginning

Despite my misgivings, there is one thing I am 100% certain of: this is the future. This is what Bitcoin is all about.

Cryptocurrency brings the economic freedom of cash to the internet, including the unsavory side of that. Law enforcement can’t prevent anyone from handing cash to anyone else. Same goes for Bitcoin. We would have to shut down every exchange and even that near-suicidal measure would likely fail. The Bitcoin community has no more ability to stop this auction than Law enforcement.

My hope is that the free market fails to give The Shadow Broker group what they seek. With luck, they will come back with a more reasonable offer. There is a fine line between demanding just reward for information, and holding that information hostage. I think this might be a case of the later.

We are about to find out how much the public values information like this. The Edward Snowden revelations were earth shattering and will undoubtedly go down in history as the most important news story of the decade. But how much are we willing to pay for them? More than half a billion dollars and potentially much more if the price rises?

Paying the ransom will set a precedent. One that will encourage leakers to come forward, but will also give them reason to expect fabulous wealth for doing so.

Will information peddlers be the kings of the next economy? The Shadow Brokers seem to be setting themselves up to be kings in the current economy and the next. Their offer is temping, knowledge for money, or rather bitcoins.

But it is a lot of bitcoins, maybe too many.