Is bitcoin a real currency an economic appraisal
A bona fide currency functions as a medium of exchange, a store of is bitcoin a real currency an economic appraisal, and a unit of account, but bitcoin largely fails to satisfy these criteria.
Bitcoin has achieved only scant consumer transaction volume, with an average well below one daily transaction for the few merchants who accept it. Its volatility is greatly higher than the volatilities of widely used currencies, imposing large short-term risk upon users.
Bitcoin prices of consumer goods require many decimal places with leading zeros, which is disconcerting to retail market participants. Bitcoin faces daily hacking and theft risks, lacks access to a banking system with deposit insurance, and is not used to denominate consumer credit or loan contracts.
Bitcoin appears to behave more like a speculative investment than a currency. Part of this research was completed while I was a visiting professor at Erasmus University Rotterdam.
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JavaScript is disabled on your browser. Please enable JavaScript to use all the features on this page. This page uses JavaScript to progressively load the article content as a user scrolls. Click the View full text link to bypass dynamically loaded article content. Abstract A bona fide currency is bitcoin a real currency an economic appraisal as a medium of exchange, a store of value, and a unit of account, but bitcoin largely fails to satisfy these criteria.
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