extension Numeric {
    func squared() -> Self {
        self * self
    }
}

In this code, the return type of our squared function is Self which according to Paul, is basically self's data type. However, why can't I use opaque return type so that Swift would figure out what the return type would be on its own?

Something like this

extension Numeric {
    func squared() -> some Numeric {
        self * self
    }
}

Because it wouldn't know what the type 'self' is - here is an explanation of the difference between 'Self' and 'self'. The 'self' is just the value, and if you don't provide the type it is just a collection of binary digits that could represent or be anything.