The Epic and Controversial Journey of BitTorrent

Twenty-five years ago, a relatively unknown programmer named Bram Cohen sent a brief message to a mailing list dedicated to peer-to-peer technology. “My new app, BitTorrent, is now in working order, check it out here,” he announced, along with a link to his personal site. The founder of the list responded with a simple, “What’s BitTorrent, Bram?” but Cohen never replied. The world would soon discover the answer.

In the years that followed, BitTorrent skyrocketed to become the most popular file-sharing application, igniting a piracy wave that transformed Hollywood forever. At its peak, BitTorrent was responsible for a staggering amount of internet traffic—some estimates suggested it accounted for half of all P2P traffic and one-third of total internet traffic in 2004. While the entertainment industry managed to shut down file-sharing platforms like Napster and Kazaa, it struggled to contain the torrent of piracy fueled by BitTorrent.

What baffled movie studios and record labels is precisely what makes BitTorrent’s 25th anniversary story so compelling. There’s the BitTorrent app that Cohen launched in July 2001, which still attracts millions of users each month. There’s the file-sharing protocol that hackers and developers worldwide have embraced and evolved, spawning a whole industry of piracy websites. And there’s the company Cohen co-founded, which faced years of challenges in monetizing its technology. “Going into it, my plan was not to start a business,” Cohen reflects. “My plan was to start a revolution.”

This is the tale of that revolution and what remains of it today.

Cohen began developing BitTorrent shortly after leaving Mojo Nation, a startup with ambitious goals to merge file sharing, distributed computing, and micropayments, which ultimately shut down in 2002 without gaining traction. At Mojo Nation, Cohen worked on enhancing file-sharing efficiency using a method called swarming distribution. Instead of transferring large files between a few users, the app broke files into smaller chunks, allowing many users to exchange those chunks simultaneously. The software was designed to encourage users to upload files as well as download them.

Disillusioned by Mojo Nation’s failure but not ready to abandon the technology, Cohen decided to create a tool focused solely on swarming distribution. “I decided to make a tool that very narrowly just did swarming distribution and nothing else, because that was a thing I knew how to do,” he explains.

This development occurred during a tumultuous time for P2P and file-sharing platforms. The music industry had sued Napster at the end of 1999, forcing it to shut down just as Cohen released BitTorrent. Soon after, the entertainment industry targeted Kazaa and Grokster, followed by legal actions against Audiogalaxy, LimeWire, eDonkey, and other file-sharing services. Despite their differences, these platforms ultimately succumbed to legal challenges, primarily because they allowed users to search for copyrighted files and facilitated the exchange of those files, which courts deemed contributory infringement.

BitTorrent, however, was different. From the outset, Cohen designed the app without search functionality, relying on third-party websites for content discovery. He also avoided running a centralized server for user connections, instead utilizing tracker servers to match users for file sharing. This structure meant that Cohen and his eventual company had no way of knowing what data was being shared, effectively shielding them from legal repercussions. To this day, BitTorrent remains the only major file-sharing software publisher that hasn’t faced lawsuits from Hollywood or major record labels. Cohen insists that the decision to outsource content search and client discovery was more about necessity than legal strategy. “My hands were somewhat tied,” he admits. “I was writing stuff on my own.”

Despite lacking the resources of larger P2P companies, Cohen’s BitTorrent app quickly gained popularity among communities eager to share large files. One of the first groups to adopt it was Etree, an online community of jam band fans who had long traded bootleg recordings. BitTorrent enabled them to share high-resolution audio files that were otherwise too large to distribute effectively.

However, it was the use of BitTorrent for pirated videos that truly propelled its growth. “When it started getting used for anime was when the numbers took off,” Cohen recalls. Early on, the app didn’t match the millions of users flocking to platforms like Kazaa, but it was still a significant achievement to see a thousand downloads a day.

The landscape shifted dramatically with the rise of major torrent sites that made it easy to find and download movies and TV shows. In 2002, a Slovenian high school student launched Suprnova.org, which reportedly attracted up to a million users daily before its closure in 2004. In 2003, a group of hackers founded The Pirate Bay in Sweden, which became a symbol of defiance against Hollywood, attracting both pirates and copyright enforcers.

While these sites gained notoriety, countless others emerged globally, catering to niche interests or welcoming all types of content. Although copyright holders managed to shut down some sites, many others persisted or reappeared under new names. The legal battles surrounding these sites generated headlines that effectively promoted BitTorrent to new audiences, leading to an explosion of traffic by 2004.

This surge not only alarmed rightsholders but also strained BitTorrent’s infrastructure, particularly the tracker servers that facilitated user connections. One popular tracker, Denis.Stalker.H3Q.com, was operated by a trio of German hackers from the local Chaos Computer Club. Initially, their tracker used server software Cohen had developed alongside the BitTorrent client. However, as popularity surged, their single server struggled to handle the influx of requests.

In response, Dirk Engling, a member of the trio known as Erdgeist in hacker circles, created a new tracker software called Opentracker. The performance improvement was remarkable; Engling’s code transformed the server’s efficiency, eliminating the constant noise of overheating. Instead of keeping his code to himself, Engling published it online for anyone to use, which led to widespread adoption by major torrent sites like The Pirate Bay. Many of these sites relied on third-party trackers but also maintained their own as backup solutions. Each torrent file could point to multiple trackers, ensuring continued sharing even if one server went down.

“Back then, it was a radical political idea,” Engling reflects. The goal was to enable anyone to distribute large amounts of data without relying on costly servers, even if some of that data was pirated. “It was a movement to democratize file sharing,” he adds.

Engling wasn’t motivated by profit; he distributed Opentracker under a “beerware” license, suggesting that anyone who found it useful should buy him a beer. “I thought: A lot of people are using BitTorrent, so…”

In the U.S., Cohen soon realized that depending on the goodwill of users—especially those downloading content for free—wasn’t sustainable. In 2004, he founded BitTorrent Inc. to turn his revolutionary idea into a viable business. “That didn’t work so well, unfortunately,” he admits.

BitTorrent raised $8.75 million in funding in 2005, followed by another $20 million in 2006. While this funding allowed the company to grow, it also pressured Cohen and his team to monetize an app that was popular among pirates. To that end, the company partnered with Hollywood to launch the BitTorrent Entertainment Network, a movie download store that debuted in early 2007 with thousands of titles. However, it quickly became clear that selling DRM-protected movies to an audience already accessing the same content for free was a losing battle.

“That didn’t work at all,” says a former senior employee who requested anonymity due to concerns about repercussions from their current employer. Not only did consumers resist buying movies from BitTorrent, but contractual obligations with Hollywood forced the company to pay millions for content that no one wanted. “It kind of worked out for the studios,” the former employee notes.

“There were gotchas in those deals that made them essentially unworkable,” Cohen agrees. “The big copyright holders were perfectly happy with where things were and basically didn’t want to create the streaming systems that we have today.”

BitTorrent closed its download store less than two years after launch and laid off half its staff during a recapitalization. In the years that followed, the company explored various business models, from P2P CDNs to decentralized chat clients, but faced obstacles at every turn.

The persistent issue was piracy. While BitTorrent avoided legal liability, it couldn’t shake its outlaw image, making it difficult to secure deals that were available to others. “When you’re doing slightly sketchy things, the world doesn’t want to give you a nice off-ramp,” Cohen explains.

One area that did work was advertising. BitTorrent included ads in its products and bundled third-party tools with its installers, earning a small cut when users installed additional software alongside the BitTorrent client. However, while ad revenue covered expenses, it fell short of meeting investor expectations for a lucrative exit.

“The app download numbers kept growing, but a lot of the use cases were never going to be the kind that you could legitimately either IPO or sell to another company,” the former employee states.

BitTorrent Inc.’s struggles contrasted sharply with the success of Cohen’s technology. “We were moving an exabyte of data every month,” estimates a former senior employee. Much of BitTorrent’s popularity stemmed from the ongoing battles over file sharing, which gained renewed attention when Swedish authorities raided The Pirate Bay in 2006.

The clash between rightsholders and The Pirate Bay is perhaps the most well-known chapter in the BitTorrent saga. The site was back online within days of the raid, thanks in part to BitTorrent’s decentralized architecture. The Pirate Bay didn’t operate a file-sharing network, and seizing its servers didn’t stop users from downloading the BitTorrent client or connecting through tracker servers. All that was lost was a public list of torrent files, easily restored with a recent backup.

Undeterred, rightsholders and law enforcement continued their campaign against BitTorrent pirates and their alleged enablers, including The Pirate Bay’s cofounders. After being charged with criminal copyright infringement in early 2008, they were sentenced to one year in prison and ordered to pay damages in April 2009. Despite this, The Pirate Bay remained online, and the identities of its new operators remain a mystery.

Hollywood’s fight against piracy also impacted the German hackers behind much of BitTorrent’s tracker infrastructure. The Denis.Stalker tracker, used by many major torrent sites, peaked at around 100 million daily peers trading a million files every day, according to Engling. One day, the Berlin police raided the apartment of one of the tracker’s operators, seizing all equipment they could find. “They couldn’t imagine that anyone was running something like this without making any money with it,” Engling recalls. However, profit was the last thing on their minds. During a talk at the Chaos Computer Club’s annual conference, they explained their motivation with three simple words: “Because we can.”

Charging them with knowingly facilitating copyright infringement was impossible, as tracker servers only match users by hash values and never see the actual files being shared. Ultimately, the case was dismissed, Engling notes. “Those were the wild early days.”

Rapid changes followed in subsequent years. Unable to shut down torrent sites and trackers, rightsholders shifted their focus to end users. In some regions, including Germany, this became highly lucrative. Law firms could send cease-and-desist letters that doubled as invoices for hundreds of euros per traded file, threatening full-blown lawsuits if recipients didn’t pay. Germany’s Stern magazine estimated that local file sharers received claims totaling around €120 million in 2010 alone.

This led many users to adopt VPNs for protection, while torrent sites capitalized on this trend by advertising privacy services. As a result, torrent sites began generating significant revenue. A 2014 study estimated that torrent sites earned around $114 million in ad revenue that year. In addition to VPNs, these sites have long promoted various products, from adult content to online casinos, often with the occasional malware download.

Today, some sites employ elaborate schemes to hijack legitimate advertising and affiliate revenues. One tactic involves opening an Amazon page for a random product in the background when someone visits a torrent site. The goal isn’t to sell those specific items but to plant a cookie on the visitor’s machine. If they make a purchase from Amazon within the next 24 hours, the pirates earn affiliate revenue—a tactic known as cookie stuffing.

“It’s whatever the latest scam is,” Engling says, sounding disillusioned about the current state of the BitTorrent world he helped create. “The idea of democratization got lost,” he laments.

While torrent sites thrived, BitTorrent Inc. continued to face challenges. “I did a good enough job of keeping the wheels from falling off the bus, keeping our core product working,” Cohen states. However, efforts to expand beyond file sharing repeatedly failed.

This included Cohen’s next major initiative: adapting the company’s technology for low-latency livestreaming. BitTorrent Live, as it was called, even produced consumer apps, and the company briefly explored creating a live online TV service. In 2017, the company abandoned these efforts and laid off nearly the entire BitTorrent Live team. “This is part of the world being out to get you,” Cohen says, still bitter that the project wasn’t given a fair chance. “That was a product that worked great and was ready to go, and was just outright fucking killed.”

Shortly after, BitTorrent Inc. was sold to controversial crypto entrepreneur Justin Sun, who subsequently closed the company’s San Francisco office after a tumultuous period and now operates it from abroad. “It eventually got an even sketchier exit than it had been all along,” Cohen quips.

Looking back, Cohen believes many of BitTorrent’s challenges could have been avoided if he hadn’t followed the typical path of a VC-backed startup. He muses that he might have been better off pursuing a more independent route, similar to Engling’s approach, but with a focus on modest revenue rather than free beer. “I never should have brought on anybody else at all,” Cohen reflects. “I could have simply gotten enough money off of doing the slightly sketchy stuff just on my own.”

The current number of BitTorrent users is unclear. The days of it accounting for a third of all internet traffic are long gone, with estimates suggesting it now contributes less to residential upstream traffic than services like iCloud and FaceTime. BitTorrent Inc., now owned by Sun, claims to have 54 million monthly users. Popular third-party clients like Transmission, BiglyBT, and qBittorrent likely attract millions more.

A website that tracks usage across multiple torrent sites estimates that about 0.25 percent of all internet users download torrents daily. “The number of torrent users has been pretty stable over the last eight years,” says the site’s admin, Andrey Rogov. Data shared by Rogov indicates that Russia, where streaming services like Netflix are unavailable due to sanctions related to the Ukraine war, is BitTorrent’s largest market, with the U.S. in second place.

Engling doesn’t have specific data on Opentracker’s total usage, but he occasionally checks the publicly available reporting dashboards of popular torrent trackers running his software. That data suggests a potential resurgence. “In absolute numbers, it has gotten more,” he notes.

One reason for this uptick? Streaming services are becoming increasingly expensive. For a time, consumers were content to pay for Netflix and Disney Plus instead of downloading content for free. “At some point, it flipped,” Engling observes. “An increasing number of consumers who previously paid are dusting off their pirate hats.”

Amid this resurgence, Engling still tinkers with Opentracker’s code, invigorated by new technical challenges. Just last month, a Spanish anime fan took him out for beers in Berlin to express gratitude for his contributions to BitTorrent’s global infrastructure.

Cohen, however, is content to leave that chapter behind and focus on his blockchain startup, Chia Network. “I don’t really care to revisit BitTorrent too much,” he states. Yet, when you start a revolution, some of it inevitably stays with you, whether you like it or not. What continues to haunt him are the challenges of transforming BitTorrent Inc. into a venture-funded startup and ultimately a profitable business.

“You know how people say they wake up their whole lives with nightmares that it’s the morning of a final exam in grad school? I never had those,” Cohen shares. “I do get nightmares about board meetings.”