Bitcoin wallet combats censorship using SMS

Bitcoin is a cryptocurrency and a peer-to-peer worldwide payment system. Transactions are processed by special computers around the world (also known as miners or network nodes) and saved in an immutable and distributed public ledger called a blockchain. Bitcoin is decentralised—financial institutions or governments don’t own or control it like the Australian or US dollar.

Lack of control usually comes with a string of illegal activities like money laundering and scams. Even though the majority of users don’t take part in such activities, some countries have decided to censor it.

To combat censorship, developers of Samourai Wallet, a Bitcoin privacy wallet, recently created an app called Pony Direct. It’s still in alpha, but it enables its users to bypass the internet and interact with the Bitcoin network via SMS. A simple text message can wipe and restore their wallets on their phones. To send Bitcoin from one wallet to another, the app sends a series of text messages to an Android device that’s connected to uncensored internet. The first message contains information about the number of messages in the series, and the rest contain transaction data. When the receiving device gets the expected number of messages from the same incoming number, data is extracted from each message before it’s pushed into the Bitcoin network.

It’s interesting to see how developers are using SMS to combat censorship. We may see more projects like this in the future, as the developers intend to make the app open source.