Jack Dorsey starts Bitcoin defense fund to help developers fight legal battles in crypto

Twitter’s founder and former CEO Jack Dorsey has announced that he will create a “Bitcoin Legal Defense Fund” in partnership with Martin White, an academician at the University of Sussex, and Alex Morcos, co-founder of Chaincode Labs, a Bitcoin research firm.

The announcement was made by an email appearing to belong to Dorsey, sent out to Bitcoin developers.  

The email said that the Bitcoin community was currently under the subject of “multi-front litigation, and continued threats that are having their intended effect”. It added that open-source and independent developers were especially susceptible to legal pressures. 

“In response, we propose a coordinated and formalised response to help defend developers,” the letter said.

The Bitcoin Legal Defense fund will serve as a not-for-profit entity, which aims to minimise legal hurdles that discourage software developers from developing projects on and related to Bitcoin. "These include the likes of Lightning Network, Bitcoin Privacy Protocols, and the likes," the letter read.

The Lightning Network is a payment protocol that can be layered on top of a blockchain-based cryptocurrency such as Bitcoin and Litecoin, and serves as a tool to speed up transactions, while also aiming to solve the problem of scalability. Scalability of Bitcoin is a commong issue, where the network is unable to handle a large number of transactions at a time.

The main purpose of the fund is to defend developers from lawsuits that engage in activates in the bitcoin ecosystem, this includes finding and retaining defence counsel, developing litigation strategies, along with legal budgets for the same. 

“This is a free and voluntary option for developers to take advantage of, if they so wish. The Fund will start with a corps of volunteer and part-time lawyers,” said the email. 

The fund will take over the coordination of existing defence of the Tulip trading lawsuit against certain developers.   

Ramona Ang, a trustee of Tulip Trust, which is one of the trusts revealed by Craig Wright, who claims to be the creator of Bitcoin, Satoshi Nakamoto, had sued Ira Kleiman, a web developer, for his conduct over access to a certain bitcoin fortune, allegedly contained in the documents of electronic devices of David Kleiman, an American computer forensics expert.   

The lawsuit alleges “breach of the fiduciary duty to provide the source of funding for outside counsel”, the letter read.