Nick Szabo considers that Bitcoin’s intrinsic value is that “it is good money.” The expert in computer science assumes that BTC and fiat money will coexist in the short and medium-term.
In recent days, developer Nick Szabo said that “Bitcoin solves a series of fundamental historical problems.” The defender of privacy on the Internet spoke about the advantages of the cryptocurrency that Satoshi Nakamoto created. He believes that it is better than fiat money and gold as a medium of exchange and a store of value.
“Expensive transactions and security problems are the main flaws of precious metals and fiat money,” according to Szabo. He stated that “the use of complete nodes and good key management practices” allow Bitcoin (BTC) to solve those drawbacks. He considers that the opposite occurs with “the expensive validation based on trust” that banking transactions with US dollars require.
The computer science expert explained that Bitcoin “corrects the digital centralization of the fiat standard.” He noted that the pioneering cryptocurrency” replaces it with decentralization resistant to censorship.”
Regarding whether Bitcoin fixes history, Szabo said that “it is a great statement.” However, he believes that “Bitcoin solved many specific problems and fundamental flaws of fiat money and precious metals.”
When reviewing the history of money, Szabo clarified that fiat money is fully based on trust in a State. He argued that there is nothing that supports it more than the power that this State has.
The fact that States can borrow and refinance debts easily affects the trust that their currencies receive. The developer considers that “fiat currencies are subject to catastrophic failures” and “often end in failure.”
Szabo perceives himself as a “trust minimalistic maximalist of”, which is consistent with his apology for Bitcoin. He explained that this monetary system eliminates the need to rely on third parties. The reasons for this are that it is open source, decentralized, and with transactions traceable on the blockchain.
According to Nick Szabo, “Being Good Money is Intrinsic Value” of Bitcoin
Bitcoin detractors frequently claim that this crypto asset has no support or lacks intrinsic value. Szabo countered this idea by saying that “being good money is an intrinsic value” of the pioneering cryptocurrency.
Although he is in favor of Bitcoin, Szabo does not believe that the crypto asset replaces fiat money in the short or medium term. He rather supposes that there will be a future where they will coexist.
“I think that Bitcoin and fiat currencies will probably work together, as it happens on some payment platforms. It is possible to have a kind of savings account in BTC and use fiat money to make daily payments. This will likely occur in the short and medium term, given the way things are going, “Szabo commented.
Szabo’s words effectively reflect the course of action regarding Bitcoin that part of the traditional financial system is taking. There have been many reports on cases of banking institutions worldwide that incorporate services with BTC, which include the custody of crypto assets.
By Alexander Salazar