Motley Fool Money Is Bitcoin Money?
Nov 10, 2020
The discussion dives into whether Bitcoin can truly be classified as money. Charlie Wheelan analyzes its effectiveness, exploring its role as a unit of account and a store of value. He highlights Bitcoin's volatility and the practical challenges it faces in everyday use. The conversation raises intriguing questions about what defines currency in a rapidly changing financial landscape.
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Bitcoin's Failure as a Unit of Account
- Bitcoin fails as a unit of account because people don't think in terms of Bitcoins.
- Even Bitcoin Foundation employees think in dollars, highlighting its lack of practical use.
Bitcoin's Volatility as a Store of Value
- Bitcoin's volatile value makes it a poor store of value.
- A currency's rapid appreciation can negatively impact long-term financial commitments like mortgages.
Bitcoin as a Medium of Exchange
- Bitcoin functions as a medium of exchange, especially for anonymous international transactions.
- This anonymity primarily benefits illicit activities, limiting its value for average users.
