Vulnerabilities will always sell for more on the black market because there’s an added cost for asking people to do immoral and likely illegal things. Comparing the two is meaningless.
To give a straightforward answer: no, I don’t think $20k is underpaid. The severity of a bug isn't based on how it could theoretically affect people but on how it actually does. There's no evidence this is even in the wild, and based on the description, it seems complicated to exploit for attacks.
No, it's priced on demand and supply like anything else; bug bounties are priced to be the amount that Google thinks it takes to incentivise hunters to sell it to them, vs. to black hats.
(But yea, I think lots of people would sell exploits to criminals for enough money.)
Your principles will be gone by the time the 10th company starts to sue you for a public disclosure you did in good faith.
There's a reason why nobody wants to use their real name and creates new aliases for every single CVE and report.
Principles are discrepancies with the law, they don't exist. If the law dictates a different principle than your own one, guess what, you'll be the one that is in jail.
Whistleblower protection laws are a bad joke, and politicians have no (financial) incentives to change that.
You are essentially been paid to fill out forms and keep your mouth shut.
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GP wouldn't sell their discoveries to the criminals. But would they consider selling them to a third party as an intermediary, perhaps one that looks very much above board, and specializes in getting rewards from bug bounties in exchange for a percentage of payout?
I don't know if such companies exist, but I suspect they might - they exist for approximately everything else, it's a natural consequence of specialization and free markets.
Say GP would say yes; how much work would they put into vetting the third party doesn't double-dip selling the exploit on the black market? How can they be sure? Maybe there is a principled company out there, but we all know principled actors self-select out of the market over time.
Or, maybe GP wouldn't sell them unless starving, but what if agents of their government come and politely ask them to share, for the Good of their Country/People/Flag/Queen/Uniform/whatever?
Or, maybe GP wouldn't sell them unless starving, but what is their threshold of "starving"? For many, that wouldn't be literally starving, but some point on a spectrum between that and moderate quality-of-life drop. Like, idk, potentially losing their home, or (more US-specific I guess) random event leaving them with a stupidly high medical bill to pay, etc.
With all that in mind, the main question is: how do you know? How does Google know?
The reason people take an economic view of the world is because it's the only tool that lets you do useful analysis - but unlike with the proverbial hammer that makes everything look like a nail, at large enough scale, approximately everything behaves like a nail. Plus, most of the time, it only takes one.
GP may be principled, but there's likely[0] more than one person making the same discovery at the same time, and some of those people may not be as principled as GP. You can't rely on only ever dealing with principled people - like with a game of Russian roulette, if you pull the trigger enough times, you'll have a bad day.
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[0] - Arguably, always. Real breakthrough leaps almost never happen, discoveries are usually very incremental - when all the pieces are there, many people end up noticing it and working on the next increment in parallel. The first one to publish is usually the only one to get the credit, though.
But if you don't pay people enough in the first place... then they're just going to spend their time doing other things that actually do pay and your bugs won't get caught except by those who are specifically trying to target you for illicit purposes.
He got nothing. No money at all. The CEO pretended to have forgotten every verbal agreement.
You only need to experience that kind of thing once to change your mind.