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Why No Bitcoin Before Satoshi Nakamoto?
Despite decades of interest in decentralized digital currencies among cryptographers, the technology did not yield a Bitcoin-like solution until Satoshi Nakamoto’s 2008 white paper.
Gwern—an internet researcher—and Nick Szabo, a cryptographer and computer scientist, explored this question in a 2011 exchange on May 27th of that year. Szabo, a pioneer in the field, defended Bitcoin’s innovations against what he saw as skepticism.
The Szabo Defense
In his technical essay “Bitcoin is Worse is Better“, Gwern contended that Bitcoin “involves no major intellectual breakthroughs”, arguing that its architecture built upon existing ideas. Szabo countered:
Bitcoin was mostly a collection of prerequisite technologies… [but], “Bitcoin is not a list of cryptographic features, it’s a very complex system… pursuing a very unpopular goal.”
Szabo outlined that while elements of Bitcoin resemble earlier proposals such as Wei Dai’s 1998 b-money or his own “bit gold” concept from similar timeframes, the final product represented more than an aggregation of existing tech:
“They required a very substantial amount of unconventional thought… about how to choose and put together these protocols.”
Intellectual Precursors
Szabo’s 1998 “bit gold” proposal is widely regarded as one of Bitcoin’s closest intellectual ancestors, suggesting ideas that mirror Bitcoin’s proof-of-work mining and time-stamped transaction blocks. Unlike Szabo’s proposal, which was never implemented, a small group of cryptographers who corresponded through a mailing list called “libtech” discussed these very ideas.
Satoshi and the B-money Connection
A technical note within the Bitcoin white paper cites Wei Dai’s “b-money” proposal, though Wei Dai has stated he did not influence Satoshi Nakamoto’s final implementation.
In recent years, Wei Dai, creator of b-money, noted in 2008:
“My understanding is that the creator of Bitcoin… didn’t even read my article before reinventing the idea himself… My connection with the project is quite limited.”
Later adding:
“At the time of Bitcoin’s creation, mining was unlikely to provide significant personal profit… [Which] was not the case with Bitcoin.”
The 50 BTC reward for mining Bitcoin’s first block—now valued over $54 million—underscores the transformative economic incentive Bitcoin introduced.
