Nick Szabo shed light on cypherpunk contribution to the birth of crypto

At the Bitcoin 2022 conference, Szabo outlined the history of the philosophical and technological work of cypherpunks that led to the birth of Bitcoin.

Today, computer scientist and cryptographer Nick Szabo appeared on the main stage of the Bitcoin 2022 conference to shed light on the background preceding the birth of Bitcoin.

The history you should know…

 Many people are unaware that Bitcoin is the result of decades of research on cryptography, freedom, and privacy.

Cryptography was the key to unlocking Bitcoin’s ability to secure itself, and the need to remove permission from the monetary equation ultimately rests in taking power away from the government and placing it in the hands of the people, which ties back to the ideals of freedom, free markets, privacy, and even Austrian economics.

Prior to the 1970s, much cryptographic development was done in secret by military or spy services. That began to change in the 1980s when Dr. David Chaum began researching and publishing papers on anonymous digital currencies and pseudonymous reputation systems.

Cypherpunk’s contribution

Thinking ahead of their time, the cypherpunks began investigating and building methods to safeguard people’s privacy as traditional modes of communication and money transmission transitioned from the physical to the digital world.

Nick Szabo was one of those cypherpunks, and he was arguably the one that dug deeper into the search for a digital form of currency.

Szabo’s quest resulted in Bit Gold, a digital currency proposal that used proof of work, a cryptographic trick used in Dr. Adam Back’s anti-spam currency Hashcash. However, Bit Gold was not the best option.

Satoshi Nakamoto, on the other hand, was inspired by Bit Gold. In fact, Nakamoto uploaded the Bitcoin white paper to the cypherpunk email list the same year Szabo posted his Bit Gold proposal.

Hal Finney, the main inventor of PGP 2.0 and the creator of reusable proof of work (RPoW), was another renowned cypherpunk who received the first Bitcoin transaction from Nakamoto.

Finney’s RPoW also used Back’s Hashcash, but his plan “never really took off,” according to Szabo.

Happy ending…

Finally, Bitcoin was able to neatly leverage the work of cypherpunks to develop a monetary network that secures itself, does not require permission, can bank the unbanked, and has survived for years. Furthermore, Bitcoin used that technological work to enable philosophical objectives.

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Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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