There are five key properties that make something a good form of money:
1.Divisible – Can it be broken into smaller units?
2.Durable – Will it last over time?
3.Recognizable – Can people easily verify it’s real?
4.Portable – Can you easily carry or transfer it?
5.Scarce – Is it limited in supply to help preserve value?
Bitcoin is the only form of money that excels in all five categories, making it the strongest monetary asset humanity has ever seen.
Point five makes it an asset. . if it is scarce , why would anyone spend it !
Currency is first four points + it must lose value ..that incentives people to spend asap .. and sets up free market .. free market means you invest in asset of your choice .. you can't give people a default asset ..
It’s a fixed amount, making it scarce
Yes .. currency must not be limited supply ( means you may add or remove ) .. because the role of currency is to keep prices inflating .. so that people are incentived to spend it ..as soon as possible ..
That is why no one saves in dollars checking accounts .. everyone buys bitcoin or stocks or real estate..
The laundry list of money’s material characteristics is huge, as listed by Carl Menger, “On the Origins of Money,” in Economic Journal 2, trans C.A. Foley, 239-255.
Originally published in 1892 (Auburn AL: Ludwig von Mises Institute, 2009), 29-32.
you can pick 4, i went with 7, without a clear purpose of what you’re trying to convey, it could go on and on.
Below is the except from my book:
Just as a steel sword surpasses a bronze one in strength and
endurance, the material characteristics of money dictate its utility and longevity.
Austrian economists refer to this as “salability,” a composite measure of the social circumstances and material characteristics that determine money’s functional potency.
But for our purposes, we need only highlight several key material
characteristics that define its strength and viability:
1) Scarce: The supply of money must be limited; otherwise, its value erodes.
Gold is scarce; pebbles not so much.
2) Portable: Money must be easy to transport. Gold coins fit in your pocket; cows do not.
3) Divisible: Money must be easily divided into smaller, standardized units.
Diamonds resist division without loss of value; gold coins split cleanly and
consistently.
4) Durable: Money must withstand the test of time and the elements. Paper
deteriorates; gold endures.
5) Fungible: Each unit must be interchangeable, holding the same value. A one-ounce gold coin equals another of identical weight and purity; unique items, like artwork or rare gems, fail this test.
6) Possessable: Individuals must be able to control, own, and transfer money without interference. Gold can be held in hand or secured in vaults; land and livestock, by contrast, are far harder to transport or conceal.
7) Acceptable: Money must be recognized and used as a trusted medium of exchange. Gold was accepted across empires; a seashell holds little weight in most markets today.
