One defining feature of sovereignty is the ability to create and control one’s own currency, and those who can do neither are servants to whomever does the creation and control on their behalf. When cryptocurrencies appeared, they gave everyone the freedom to control their own currency, which understandably made governments feel threatened, with Qatar even banning them outright for religious reasons. Wei Dai came up with the idea to create a cryptocurrency that would flip the script and ban governments instead, inspiring the creation of Bitcoin. So you ask, who is Wei Dai? He is a computer scientist, cryptographer, and cypherpunk known for creating b-money, an early proposal for decentralized digital cash that influenced Bitcoin. Satoshi contacted Dai, and cited b-money in the Bitcoin whitepaper, after Adam Back brought it up in their email correspondence, but Dai has stated that he had no direct involvement in Bitcoin’s creation. When Wei Dai proposed b-money, he was influenced by the Extropian community, which had already outlined core principles of decentralized currency, such as proof of work, consensus mechanisms, and the use of digital pseudonyms, all foundational elements that later shaped Bitcoin. Dai also developed Crypto++, a widely used cryptographic library, co-designed the VMAC message authentication algorithm, and identified critical security vulnerabilities in SSH2 and SSL/TLS (BEAST attack).
First Off, There Are Two Wei Dais
As is common with cypherpunks, Wei Dai is a mystery, but he took it one step further and hasn’t even provided us with a picture. He doesn’t appear anywhere in public under that name, though he is active on some platforms that show his posts from as recent as mid-2024. To further confuse the matter, there is a different Wei Dai, who is also involved in cryptocurrencies and whose website wdai.us has a picture and a disclaimer that he is not the inventor of b-money. That picture and illustrations based on that picture are often wrongly used in articles on the cypherpunk Wei Dai, whose website is weidai.com. I think it’s a good rule of thumb that any article that shows the picture of the wrong Wei Dai when referencing the cypherpunk Wei Dai is poorly researched at best and intentionally misleading at worst.
⚠️ Not the Wei Dai who created b-money.
That picture is obviously of an Asian man, and with their names being the same, it’s understandable that people think the cypherpunk Wei Dai has an Asian background too, but I don’t think that’s necessarily true, and his name could be a play on words. I spent some time on BehindTheName.com, which describes the origin and the meaning of names, and discovered that Wei is a masculine Chinese name that can mean “powerful” or “great,” but it can also be feminine and mean “small” or “fern,” and that Dai is the short form of the Welsh name “Daffyd,” which comes from the Jewish name “David.” For all we know, the cypherpunk Wei Dai could be a masculine-presenting Jewish woman from Wales who is in love with Chinese ferns, but for the sake of simplicity, I will refer to this person as “he.”
Wei Dai’s Writings and Hangouts
Wei Dai’s identity is not as interesting as his writings, of which we have quite a bit thanks to his website. Last updated in 2021, the website is a collection of texts and links that indicate Wei Dai’s thinking, interests, and favorite hangouts where we can see a glimpse of his true personality. He used to participate in the cypherpunk remailing list, sending a total of 132 emails as Wei Dai from a curious little web hosting service called “Eskimo North” and based in Washington, USA. Eskimo North was started in November 1992 and is still running, though it has changed a bit from a website that hosted kooky conspiracies and resources on UFOs and education to a more professional web hosting platform that promotes freedom of speech. I dove into those texts and links and followed the rabbit holes to discover who is Wei Dai, with my findings presented below. In short, Wei Dai is very interested in something called “extropy,” an idea that humans will eventually become so smart that they will travel to other planets, but they need to deal with problems on this planet first, especially those that are blocking the development of their intelligence. His posts on the cypherpunk mailing list were focused on encryption and economics, while the posts he made on the Extropian mailing list dealt with complex problems of building smart technology while figuring out how to stop it from taking over and destroying us.
Wei Dai’s Cypherpunk Discussions
Wei Dai joined the cypherpunk remailing list in August 1994, with his first post being on trusted, decentralized timestamping. His idea was basically to encrypt information and publish the hash of it in a public place, such as The New York Times, with the author able to prove authorship at any later time, in court if need be. Timothy C. May replied that NYT would have to publish countless pages of hashed information and that a more practical approach would be to encrypt the encrypted data over and over again and post that instead, which is in essence how a blockchain works. Wei Dai was fascinated by Tim’s ideas on total anarchy that is secured by computing and will even say it in the first sentence of his 1998 b-money proposal, which is kind of glossed over when discussing cypherpunks and cryptocurrencies. Each cypherpunk had a role model, but the one common to all of them was David Chaum, and much of their discussion on anonymity and untraceability stems from Chaum’s work on mixing traffic to hide identities.
The Costs of Anonymous Communication
In 1995, Tim and Wei Dai discussed their favorite sci-fi book, a 1992 novel “A Fire Upon the Deep,” which paints a picture of a galaxy that has zones of “slowness” and where humans have to move to other planets in spaceships to escape the space that’s literally making them dumber. The topic of going beyond the limitations of human intelligence with the help of machines was one of Wei Dai’s deep interests, and he sometimes mentioned it in his other posts elsewhere, with him eventually becoming a full-fledged member of the extropy mailing list. The book also mentions cryptocurrencies and the problem of securing them from an enemy who maybe has infinitely powerful computers or artificial intelligences (AIs). The two go on to detail how having a publicly accessible cryptocurrency makes it more vulnerable to disruption, but how there is always a cost to anonymity, even if the communication is as simple as sending an email through the remailer network like they were doing. Tim said that there are always tradeoffs and that it’s the urgency that increases the cost, but the market will decide on the price. In his opinion, small text messages, such as their emails, can tolerate a lot of delay if that means they will be sent cheaply or for free.
Envisioning Tor and Torrents Ahead of Time
Wei Dai said that, rather than sending text messages or small text files, he was more interested in enabling anonymous real-time interactions, such as anonymous video conferencing. Tim replied that it would be very difficult to make that kind of traffic anonymous and cheap and that anyone could easily analyze it to figure out who is talking to whom. He added that there would be a price for that kind of conversation, one that would be up to the market to decide, but real-time video calls of that kind would probably stay impossible for a long time. Wei Dai concluded by mentioning the super-duper compression featured in the book and expressed his hopes that someone will come up with something like that in 10 years or so. Hal Finney joined the conversation too, posting about the idea of creating a remailer for internet browsing. He said that cypherpunks had discussions on the concept of bouncing internet traffic, but it hadn’t worked very well because the connections were short and there was not enough traffic to hide in. He mentioned asynchronous transfer mode (ATM), which meant breaking up any file into packets and spreading the packets around until they reached the destination and were assembled there. To me, the two ideas he mentioned (bouncing traffic and splitting files into packets) sound like the Tor internet browser and peer-to-peer file sharing, such as torrents. BitTorrent was released in 2001 and the Tor Browser in 2008.
Analysis of Anonymous Traffic
The conversation continued a few weeks later, with Wei Dai intent on figuring out what it would take for an attacker to analyze internet traffic going through a remailer. He basically said that all it takes is time because remixing messages and bouncing them around would help hide identities, but eventually anyone who watched and analyzed the traffic would be able to make a probability score for each participant and ultimately make a high enough score that connected Alice to Bob as his most likely conversation partner. Hal Finney commented on it by praising Wei Dai’s earlier proposal to include a small number of fake messages in each conversation so that everyone is equally likely to be talking to anyone else. That idea sounds similar to what Monero does with its ring signatures that hide the real sender among fake senders. Hal said that those fake messages would make the network slower, but that could prove to be useful, as that too would help hide who is talking to whom. So, instead of fighting latency, the ideal network for anonymous communication or data sharing would leverage it to hide the senders and recipients. Analysis of that kind of traffic would still be possible, but now the analysis would take much longer and require much more resources to establish the probability scores. Wei Dai replied that he wouldn’t count on it being a reliable security feature and that the network would need more. In a later reply, Wei Dai suggested creating a network of servers that have a 24/7 connection between them with low bandwidth to defend against traffic analysis while letting users chat anonymously in real time.
Introducing Pipe-net, the Cypherpunk Skype
Though Wei Dai kept bringing up the topic of his 24/7 network of servers that could be used for anonymous video conferencing, few cypherpunks were willing to give their comments or ideas. He wasn’t bothered by it because he knew that people who agree don’t say anything. Still, he wanted to push the topic because, in Wei Dai’s opinion, to create the real cryptoanarchy, cypherpunks need to enable anonymous, secure, and reliable business communication. Then, to try and make his idea sound more appealing, he gave it a name — “Pipe-net.” Eric Hughes commented on the name, saying it’s not needed at this time and they should first flesh out the two most important details, which are forwarding and link encryption. The next couple emails by Wei Dai reveal that he was trying to solve link encryption, sending a few messages on how other cypherpunks could do that as well. It’s in February 1995 that he sent an email that will bring us closer to the revelation of who is Wei Dai and what he was trying to do with Pipe-net. Titled “law vs technology,” the email states that all governments eventually start reducing the freedoms of the governed, so instead of negotiating with a government to take back the freedoms, the people should develop and refine the technology that guarantees their freedoms in the first place.
Talks About Anonymous Credit and B-money
In January 1998, Wei Dai’s efforts in trying to create a discussion around Pipe-net finally bore fruit, and he shared a description of it with the cypherpunk remailing list. He said that he met with Eric Hughes, Hal Finney, and David Wagner at the Crypto ‘96 conference, held in August 1996 in Santa Barbara, California, and discussed Pipe-net with them before finalizing the concept. Despite my best efforts, I couldn’t find any images of him at the conference, which is par for the course. In short, users in Pipe-net send each other packets of fixed size at regular intervals, with the sender being anonymous but not the recipient. When two users try to communicate through Pipe-net, the sender uses layered encryption and shares the encryption keys with the users between him and the recipient. As the message moves through Pipe-net, users that are in between strip the encryption so that it arrives at the other end unencrypted. In April 1997, Wei Dai shared his thoughts on the idea of anonymous credit, saying he was inspired by the economist Steven Landsburg, though he found his concept fatally flawed. The idea is that the government helps everyone get credit by issuing anonymous zero-coupon 10-year treasury bonds, meaning there is no interest on them.
They are funded by the mandatory tax that is collected upon the end of the 10-year period, and those who don’t use them just return them to the government. The fatal flaw is that a government has no interest in helping its citizens be anonymous and self-sufficient and actually has all the incentives to do the opposite in order to control them. In November 1998, Wei Dai sent an email to the cypherpunk remailing list titled “PipeNet 1.1 and b-money,” where he admitted that his original concept had some flaws that allowed attacks against it and proposed a new version of Pipe-net. It never got built in the form he envisioned, but I think Skype came very close to it, though it couldn’t find enough users and was ultimately shut down, being replaced with more centralized software, such as Zoom. Finally, he shared his b-money proposal, to which Adam Back replied by pointing out seven flaws in it and mentioning his own idea of hashcash. Soon after, Wei Dai sent his last messages to the cypherpunks remailing list, and stopped participating entirely in December 1998.
What Is Wei Dai B-money? Proposal For Government-free Future
Despite my best efforts, I couldn’t find the definite origin of the name “b-money.” I think that given Wei Dai’s earlier discussion on anonymous credit bonds, it stands to reason that b-money means “bond-money” that can give people a fresh start every 10 years and let them keep their freedom while avoiding inflation. What is Wei Dai b-money? It is an idea published in a 1998 paper by Wei Dai, in which he detailed a decentralized economic system that didn't rely on a government or a central authority. The document mentions many of the principles of Bitcoin, including that money is created by solving computational problems and keeping all transactions on a public ledger. We only learned about b-money and who is Wei Dai when Satoshi referenced his b-money proposal in the Bitcoin whitepaper when mentioning the public announcement of all transactions under section 2, “Transactions.” A curious detail here is that Wei Dai later posted that Satoshi hadn’t read the b-money proposal, and he actually came up with the idea on his own and only later credited Wei Dai.
What Are Wei Dai Satoshi Emails? A Courteous Gesture by Satoshi
Satoshi reached out to Wei Dai to mention the fact that he referenced b-money in the Bitcoin whitepaper, a courteous gesture that shows he was a scholar and a gentleman. There are many people who got contacted by Satoshi, such as Martti Malmi, an early Bitcoin developer who was even given a task by Satoshi. What are Wei Dai Satoshi emails? They are a set of emails that was sent between August 2008 and January 2009 and started when Satoshi reached out to Dai, asking the year of publication of his b-money proposal (after hearing about it from Adam Back) in order to cite it in the Bitcoin whitepaper. Wei Dai confirmed that b-money was first proposed in 1998 and said that he would take a look at Satoshi’s whitepaper. In January 2009, Satoshi sent him another email announcing the release of Bitcoin v0.1, saying it achieves nearly all the goals b-money set out to solve. Wei Dai replied by linking to the cypherpunk mailing list and thanking Satoshi for the update. In January 2009, Satoshi sent the final email to Wei Dai, informing him of the release of Bitcoin v0.1 and citing Hal Finney’s comment.
Is Wei Dai Satoshi? The Supporting Evidence Is Scant
Many crypto influencers claimed this or that person to be Satoshi, often with little backing. Some even used the fact that they were contacted by Satoshi to create fame around themselves and push their projects, such as Craig Wright, who even went to court over it and dragged Adam Back into it. Is Wei Dai Satoshi? No, but he was suspected to be Satoshi because he lived in London, and Satoshi’s mining timestamp matches the UK time zone, plus the genesis block had a quote from The Times, a British newspaper, he has deep knowledge in C++, which is the Bitcoin client’s language, and Dai even created Crypto++, which shares similarities to the Bitcoin code, and even the Bitcoin client relies heavily on its library, and he was also a regular poster on the cypherpunk mailing list. Finally, Dai’s proposal of b-money and its similarities to Bitcoin make him a prime suspect. He has denied all allegations, with his main justification being the fact that Satoshi sent him an email after Adam Back pointed him to Dai’s b-money concept, leading him to cite it in the Bitcoin whitepaper.
Wei Dai’s Extropian Writings
Besides the cypherpunk mailing list, Wei Dai participated in the Extropian mailing list, archiving some of their 1996–2003 discussions on his website. The tone of Wei Dai’s contributions there is much more lively and confident, which to me indicates that he felt like he was an expert on those topics. The problem is that there is no explanation of core terms, which seems to be an intentional method of keeping the newbies from joining and spamming conversation like they did with the cypherpunk remailing list. I got a feeling that Wei Dai had to tone down his intelligence and passion in the cypherpunk remailing list and only in the Extropian mailing list did he show his true potential. A major theme in his writings there was privacy as it related to business deals. How much should anyone be allowed to know about someone else for the purposes of making a business deal while not intruding on that person’s privacy?
For example, in one message from June 19, 2003, Wei Dai wrote about buying a car that might have hidden problems. Should we let a super-AI read the seller’s mind to discover if the car has some problems? Wouldn’t it be easier to just ask the super-AI to build a new car from scratch? In the Extropian mailing list, Wei Dai often participated in discussions started by a certain Eliezer Yudkowsky, an AI researcher from California who promotes the idea of a friendly AI. He founded Less Wrong, a blogging website dedicated to rationality and AI. Again, Wei Dai posts there and is a frequent participant in various discussions, though he sometimes misses posts and comments directed at him. Finally, Wei Dai is on the SL4 mailing list, which also revolves around AI, where the owner and one of the moderators is again Eliezer. When Wei Dai was involved with the cypherpunks, he adored Timothy C. May, but now he seems to have found a different role model, which is a noteworthy detail that shows more about who is Wei Dai.
Wei Dai’s Heretical Thoughts Gave Us Bitcoin and PlasBit
Governments are afraid of anyone who shows the ability and the courage to reclaim his sovereignty, such as by figuring out a way to create and circulate money that cannot be seized or debased. That’s exactly what Wei Dai suggested in his heretical b-money proposal when writing that he wants to make governments “permanently forbidden and permanently unnecessary.” B-money would help people go off the grid and live a peaceful life, participating in the society and the labor force when they want to and how they want to, and while Bitcoin isn’t the ideal cryptocurrency, it is a step in the right direction. We actually had a discussion at the PlasBit office about Wei Dai’s ideas, especially the one of anonymous credit, and came to an agreement that there is no way any government would ever do it. If anything, governments would want to take even the increasingly worthless cash from us just so we’re compelled to participate in their rigged system. Yet, struggle we must, and struggle we do, and if our desire to live a free, happy life makes governments see us at PlasBit as heretics, then so be it.
