Screen Shot 2015-11-18 at 4.55.47 PM

A definition of money is that it provides the function of [universal] indirect exchange. Currently, Bitcoin fails that test. The use or acceptance of Bitcoin in indirect exchange is still restricted to [mostly] early adopters.

The current surge of interest in Bitcoin, myself included is as a vehicle of speculation. I have no interest [currently] in using Bitcoin as ‘money’. It is an asset class that to date has increased in value and could further increase in value.

One major issue [for me] is that in the event of war, possible invasion, could I store any wealth in Bitcoin and could I, if necessary, access it? Currently you need a computer and access to the internet, assuming an internet still exists. Sure this is an end-game argument, but it is an argument put forward by advocates of Bitcoin. This however is a scenario where fast access to a gold coin, to offer a bribe, comes out streets ahead of, I’ll just login and transfer to you a Bitcoin.

As to transferring money around the world, it can already be done. True it’s not invisible to the authorities, but most people have no real need of the anonymity provided. For the few that do, then this is a major advantage.

The jury is still out on whether Bitcoin will go mainstream as a money. This is however an argument that drives the valuation of Bitcoin, that Bitcoin will replace fiat money and to do so, Bitcoin will be valued at the current value of all available money in the world. I have no idea whether that will happen. I personally just couldn’t be bothered to use it as a medium of exchange, in its current form it’s just too much effort. To date, your average person does not understand Bitcoin, although due to the phenomenal rise in money prices, they have heard of it.

 

Advertisements