Who is Nick Szabo ?

He is one of those who laid the foundations for creating cryptocurrency. Nick Szabo is a reference in the cryptographic landscape. From smart contracts to Bit Gold, his genius is matched only by the scope of his works. This leads some speculators to suggest that he is the true creator of Bitcoin. In this dossier, discover this extraordinary figure.

Education and Interests

First and foremost, it is important to know that outside of his professional activities, very little is known about Nick Szabo’s personal life. The man is very private about his personal life and prefers to prioritize his work. Nevertheless, thanks to some archives, we have been able to gather some information about him.

Nick Szabo is an American of Hungarian origin. He studied at the University of Washington, where he obtained a degree in computer science in 1989. He also holds a law degree from the George Washington University Law School.

In 2017, he received an honorary doctorate in social sciences from Universidad Francisco Marroquín in Guatemala. Additionally, he is very active in the research field, earning him the title of honorary professor at this institution.

Besides his passions for research, computer science, and law, he is interested in cryptography, economics, and history. Furthermore, he runs a blog where he regularly publishes articles and tutorials on various subjects.

The Idea of Smart Contracts

Both a computer scientist and a lawyer, Nick Szabo managed to combine his two professions by adopting an innovative approach.

In 1996, he published an article titled “Smart Contracts: Building Blocks for Digital Free Markets.” In this work, he introduced a futuristic concept set to revolutionize online commerce: smart contracts.

Indeed, to address the challenges of the new digital age, Nick envisioned a system of contractual agreements between strangers based on self-executing programs.

For him, smart contracts were interesting because they could accommodate a wide range of contractual clauses, thereby heavily penalizing the offender in case of a contract breach.

The Application of Smart Contracts

Furthermore, he highlighted four fundamental principles necessary for implementing an effective smart contract. Specifically, a smart contract must:

• Allow contractors to observe each other’s performance during the contract execution (observability)
• Offer the possibility to easily verify whether the conditions set have been met or breached (verifiability)
• Only reveal the contract data to the various parties to the extent necessary for its execution (confidentiality)
• Be capable of self-execution when all criteria are met (enforceability).

Although this technology fell into oblivion for several years, the advent of blockchain technology brought it back to the forefront. Today, supporting smart contracts is an obvious choice for most existing protocols.

Bit Gold, the Predecessor of Bitcoin

In 1998, Nick Szabo introduced Bit Gold as a response to the dysfunctions of the traditional financial system. The name he gave to this project reflects its nature as a digital currency (transfer of bits) that possesses the same attributes as gold (absence of trusted third parties, scarcity).

In fact, Szabo considered that trusted third parties were a vulnerability for the established financial system.

According to him, the centralization induced by these intermediaries led to significant costs. Ultimately, these costs were passed on to end users.

Therefore, for the researcher, it was essential to minimize third-party intervention as much as possible. Moreover, with Bit Gold, Szabo also sought to address the problem of inflation.

Bit Gold vs. Bitcoin

Bit Gold (not to be confused with Bitcoin Gold, which is a fork of Bitcoin) is very similar to Bitcoin in its operation. In fact, some of the principles that Nakamoto’s protocol uses were already present in the logic of the American researcher’s work in the late 1990s.

• Generation and timestamping of hashes
• Creation of the blockchain
• Maintenance of a distributed ledger
• Link between a block and its predecessor
• Proof of work
• Transparency of the data ledger
• Digital signatures
• Independence from any server

That said, there are some notable differences between the two protocols. For example, while the Bitcoin network relies on computing power to reach a consensus, Bit Gold focuses on the number of addresses present on the network. Additionally, Bit Gold does not incorporate a difficulty adjustment system in its consensus algorithm.

Is Nick Szabo the Real Satoshi?

Szabo is often identified as the true Satoshi Nakamoto for several reasons. The first is that Bit Gold and Bitcoin share many common characteristics.

In April 2008, the American called for mobilization through his blog to realize his project. About six months later, a certain Satoshi Nakamoto mysteriously appeared, presenting the Bitcoin white paper. Interestingly, Szabo allegedly changed the publication date of his call for contributions from April to December 2008, perhaps to mislead.

Another surprising fact is that in the Bitcoin white paper, Nakamoto cites the work of Adam Back (Hashcash) and Wei Dai (b-money) while omitting that of the creator of smart contracts. The similarity between Bit Gold and Bitcoin is so astonishing that this omission makes Nakamoto’s actions even more suspicious.

On his part, while BTC was the topic of conversation on cryptography forums in 2010, Szabo never mentioned the pioneering cryptocurrency at that time. However, when Satoshi withdrew from the project, the lawyer suddenly resumed talking about cryptocurrencies.

Therefore, many consider him a key player in Bitcoin’s history, alongside Gavin Andresen, Mark Karpeles, and Hal Finney.

Conclusion

In 2014, a collective of forensic linguistics experts from Aston University attempted to determine who was behind the creation of Bitcoin. To do so, they studied its white paper and compared it to the texts of about ten individuals suspected of being Satoshi Nakamoto. They concluded that Nick Szabo

La Rédaction C.

L'équipe éditoriale de Cointribune unit ses voix pour s’exprimer sur des thématiques propres aux cryptomonnaies, à l'investissement, au métaverse et aux NFT, tout en s’efforçant de répondre au mieux à vos interrogations.