Many examples of open-source software exist today, including the code for Bitcoin and other cryptocurrencies.

“Open-source” describes software or code that is available for anyone to use, modify, study, or share without incurring any cost. In most cases, the open-source software has been created through unrestricted and collaborative community involvement, which is sometimes called “crowd-sourced.” The word “source” in this case refers to the source code that lays the foundation for software programs. In some cases, the same source code can be used as the foundation for many different software applications built on top of it. For example, the Valve Corporation’s game engine code, ironically named Source, has been used to create approximately 50 different games, many of them by independent developers using the open-source code.

Software such as this is often created using a natural-selection process in which possible uses or changes to the code are proposed and discussed by a community using websites such as GitHub, which have earned the trust of many developers, to share the software, and various forums and so forth to discuss the best ideas. Certain points in the open-source system will be moderated or administered by members of the community who have proven themselves to be capable and knowledgeable, but the cast of character and forums for many projects often changes and branches off in an ad-hoc manner. Open-source communities are sometimes described as meritocracies, in which the most capable and adept developers will naturally lead the pack. They also might be referred to as ad-hocracies, denoting the fluidity and lack of centralized leadership.

For Bitcoin and other cryptocurrencies, it means that there are no secrets to how it works and that upgrades can be developed by the community-at-large if it appears that they are necessary. One-way encryption techniques such as Merkle trees, blind handshakes, and tokenization are used, which means that even if everyone in the world knows how the encryption works, it still won’t allow them to do anything nefarious. Hacks that have succeeded in the Bitcoin community have been due to breaches at the exchanges run by companies who held the personal keys of their customers.