Nick Szabo: central banks can switch to cryptocurrency reserves compared to gold

Economy

At the Israeli summit Bitcoin at Tel Aviv University on January 8th, veteran cryptographer Nick Szabo explained that the use of censorship-resistant cryptocurrencies will increase in countries sanctioned by trade and economies suffering from a failed monetary planning. Szabo also said that central banks in the world could use cryptocurrency reserves in the future to supplement national gold reserves.

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Nick Szabo firmly believes Involved economies and sanctioned countries will seek refuge in cryptocurrencies

Cryptographer Nick Szabo is an interesting character and a well-known figure in the cryptocurrency community. Long before Satoshi Nakamoto introduced Bitcoin, Szabo designed the Bitgold concept in 1998. Two years earlier, that of Szabo written envisaged the use of smart contract technology and autonomous organizations. On January 8, Szabo spoke to the Israel Bitcoin Summit at the University of Tel Aviv and gave the crowd a history lesson on the use of currencies all over the world. During the speech, Szabo explained to the participants that he believes that the blacklisted nations from the trade and the regions that deal with hyperinflation will turn into digital resources. In the last two years, cryptocurrencies like BTC e BCH they are gaining traction in areas like Venezuela, Zimbabwe, is I came across.

According to the participants in the cryptocurrency event at the University of Tel Aviv, Szabo's main note was the response to comments by Avi Simhon, senior economic policy advisor and head of the Israeli National Economic Council. Simhon observed at the summit that Bitcoin technology is "inherently inefficient" and "will disappear". In addition, the prime minister's economic policy adviser explained that the use of technology on a global scale would have wasted "trillions of dollars in actual costs on energy".

Central banks can also try to accumulate bitcoin reserves on gold

Obviously Szabo firmly believes in cryptocurrencies and his speech explains the many advantages of the digital revolution. In addition, Szabo said that it is possible that in the future some of the world's central banks will turn into cryptocurrencies rather than gold.

"There will be some situations where a central bank can not trust a central bank or a foreign government with its own bonds, for example," Szabo emphasized during his speech. "A solution that has been developed is to have the Swiss government in hand for you – it is not a minimized trust solution, the Swiss government itself is subject to political pressure and therefore a more reliable and minimized solution is the cryptocurrency".

Szabo continued:

The other problem with gold reserves is that they are physically vulnerable. When the Nazis conquered countries in Europe, the first place they went was the gold reserve of a central bank.

In recent weeks, a number of major producers and economists have said that the world is facing tumultuous times. Traditional investment vehicles such as equities and stocks have been extremely volatile, but precious metals markets have recently posted significant gains. On the contrary, last Monday the spot price of gold reached six months at the top at $ 1,288.03 per ounce and gold futures adjusted to $ 1,289.90 per ounce. Meanwhile, due to increased demand and global shortages, palladium has hit a historic peak this week.

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During the speech in Israel, Szabo seemed to be much more confident about the future of digital resources than precious metals. Many advocates of cryptocurrency over the years take the cryptographer's predictions seriously because of its early predictions on the future of smart contracts. A member of the audience at the Tel Aviv summit also cited Szabo for saying "Bitcoin could survive a nuclear war".

What do you think of Szabo's claims on cryptocurrencies? Let us know what you think of this topic in the comments section below.

Image credits: chirping, Steph Vaughan, Shutterstock and Pixabay.

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