Get Our NewsletterWIRED’s biggest stories delivered to your inbox. WIRED was sent a small, sleek mining device manufactured by the bitcoin osha 300-defunct Butterfly Labs. Here’s what happened to WIRED’s 13 Bitcoins—and to the millions of others that have faced the same fate. Stefan Antonowicz, WIRED’s then-head of engineering, set up the miner.
When we received that Butterfly miner, we had a new ethical question: What do you do with the proceeds of a review device that essentially prints money? First, it’s probably worth explaining how WIRED accrued its six-figure Bitcoin fortune. While fiat currencies, like the dollar, rely on banks and government regulators, Bitcoin runs on a peer-to-peer network monitored by an army of volunteer miners that run specialized software. Every 10 minutes, all the miners in the network race to solve a series of complex cryptographic math problems. The computers that win are awarded a slice of 12. Over time, the puzzles have gotten harder, leading to a kind of computing-power arms race.
Back when Bitcoin first launched, it was possible to mine coins using an everyday computer. These days, you’ll need specialized hardware significantly more powerful than the Butterfly Labs miner WIRED had. WIRED’s miner essentially won the Bitcoin math lottery a couple of times, allowing it to generate a little over 13 coins into the network. Then, the staff had to figure out what to do with them.
We had a very long conversation, over several weeks, about what to do with the money,” says Michael Calore, a senior editor at WIRED who has been at the magazine since 2006. Some staff members argued the Bitcoin should be donated, or set aside for a charitable purpose in the future. I said we had to dump it and donate the money to charity soonest or we wouldn’t be able to cover Bitcoin,” says Adam Rogers, a deputy editor at WIRED. We had to disclose it in every story. Eventually, it was decided that the private key, which unlocks the Bitcoin wallet and allows the funds to be spent, should be destroyed. We talked about donating it to a journalism institution, or setting it aside as a scholarship.
But we decided that if we gained any benefit from it at all, it would color our future coverage of bitcoin,” says Calore. So we just destroyed the key, knowing full well that it could eventually be worth six or seven figures. Together, the combination of codes lets you trade Bitcoin without an intermediary like a bank. You can look up WIRED’s public key to send us money, and then in theory, we could use our private key to access those funds—had we not destroyed it. No additional copies of the private key exist, at least according to the people who were there. I didn’t make a copy of the paper, or commit the 64 characters on it to memory,” says Antonowicz, the technologist who set up the miner.