On the Origins of Money and Bitcoin

Recent textual analysis done on the original bitcoin whitepaper leads down interesting paths.

“I started from the Bitcoin whitepaper published in late 2008, and proceeded to run reverse textual analysis – essentially, searching the internet for highly unusual turns of phrase and vocabulary patterns (in particular places which you would expect a cryptography researcher to contribute to), then evaluating the fitness of each match found by running textual similarity metrics on several pages of their writing. [This] led me rather directly to several articles from Nick Szabo’s blog.”

This analysis appears in a post dated 1 December 2013 on the WordPress blog Likeinamirror.

Here is some of the evidence he cites:

Content-neural terms:

  • Repeated use of “of course” without isolating commas, contrary to convention (“the problem of course is”)
  • Expression “can be characterized”, frequent in Nick’s blog (found in 1% of crypto papers)
  • Use of “for our purposes” when describing hypotheses (found in 1.5% of crypto papers)
  • Starting sentences with “It should be noted”(found in 5.25% of crypto papers)
  • Use of “preclude” (found in 1.5% of crypto papers)
  • Expression “a level of “ + noun  (“achieves a level of privacy by…”) as a standalone qualifier

Content-bearing terms that have common synonyms in the field and thus could easily have been expressed in a different way:

  • Expression “timestamp server”, central in the Bitcoin paper, used in Nick’s blog as early as January 2006
  • Repeated use of expression “trusted third party”
  • Expressions “cryptographic proof” and “digital signatures”
  • Repeated use of “timestamp” as a verb

While this does not necessarily imply that Nick Szabo “is” Satoshi Nakamoto, at a minimum, it is strong evidence that significant parts of the writing in the whitepaper entitled bitcoin.pdf came from his keyboard. Moreover, it seems clear that he was one of the key thinkers contributing CPU-time to what eventually evolved into today’s cryptocurrencies.

Nick Szabo’s comments on the origins of money are worth reading. He writes:

Hardly anybody actually understands money. Money just doesn’t work like that, I was told fervently and often. Gold couldn’t work as money until it was already shiny or useful for electronics or something else besides money, they told me. (Do insurance services also have to start out useful for something else, maybe as power plants?) This common argument coming ironically from libertarians who misinterpreted Menger’s account of the origin of money as being the only way it could arise (rather than an account of how it could arise) and, in the same way misapplying Mises’ regression theorem. [This] even though I had rebutted these arguments in my study of the origins of money, which I humbly suggest should be should be required reading for anybody debating the economics of Bitcoin.

On a related note, Nick Szabo’s blog http://unenumerated.blogspot.com contain plenty of intriguing thinking on a wide range of topics.

Thanks to David Gilbert at the IB Times for publicizing this.

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