Can We Call Bitcoin Money?
One of the most recent topics on our agenda right now is whether Bitcoin is money or not.
Is Bitcoin digital money, virtual money, or crypto money? We can say yes to all of these. Let us take the cash we deposited in the bank as an example, we use this cash in our online shopping, right? Then it is okay to call this cash that we have mentioned digital money. However, we can tell that Bitcoin replaces money and is far superior to it in some cases and that it has significant problems in other cases.
The characteristics of money
1) The value written on the money: Since the price of Bitcoin is unstable, its value is constantly new.
2) Money has standard features: Bitcoin can be used for shopping.
3) Accounting unit: There is no problem in applying the accounting logic.
As time passes, more and more people learn about and acknowledge Bitcoin in all countries. We can associate this situation with the trust people have in Bitcoin. The most problematic aspect of Bitcoin is its unstable nature. This troublesome nature of Bitcoin makes it difficult for Bitcoin to replace the money. In other words, as its price fluctuates, its potential of substituting the money will decrease, and as its price fluctuation decreases, its potential of substituting the money will increase. The strongest aspect of the Bitcoin is its portability. Today, no kind of money (cash, money in the bank) can compete with Bitcoin in terms of portability. You might say "but we can send money wherever we want via SWIFT". However, in this case, you may be subject to a large amount of commission payment. You also have to consider the processing time of the transaction.
The other strong aspect of Bitcoin is its divisibility. That is the capability of currency to be divided into smaller units. The smaller units a currency can be divided into, the more usability it has. For example, 1 Bitcoin can be divided into 100 million. We call one 100 millionth of 1 Bitcoin a satoshi. There is no such thing as the end of the useful life of Bitcoin. For instance, banknotes can get worn. Then the Central Bank takes the worn-out banknotes off the market and adds new ones. Accordingly, we can say that the current useful life of today's cash is 3 to 5 years. Whereas, the same does not apply to Bitcoin.