What are the commonalities and characteristics of Currencies and Bitcoin?
Throughout history, banknotes and precious metal coins have almost become the main representative currencies after bartering. However, with the development of technology and commercial activities, commodity currency transactions have gradually become electronic transactions and transfers.
Does the current level of technology require a new currency revolution?
Banknotes, precious metal coins and Bitcoins all have functions of general equivalents.
Precious metal currency is a valuable commodity, while paper money has no value and is a symbol mandated by the state. The credibility of paper money is provided by the state.
Bitcoin is the product of currency denationalization, a symbol, and its credit is supported by the common confidence of everyone.
Opinions about Bitcoin
- Currencies are created to facilitate commodity transactions, but the future of Bitcoin comes from everyone’s confidence.
- Bad money drives out good money is mainly a phenomenon of metal currency circulation. But in the open currency market and international trade, people tend to buy or choose currencies with strong trends and stable currency values.
- In international trade, people also tend to choose hard currency.At this time, good money drives out bad money.
Bitcoin is now more popular because of its strong currency value and is a kind of “good money”.
- Bitcoin is traded spontaneously through virtual platforms, and it is not yet regulated. It has indeed weakened the role of the government and challenged the monopoly over the issuance of national currency, especially those small countries with fragile monetary systems.
- Bitcoin has the property of virtual investment, and it also has the property of certain currency. But now it seems that its investment property has been exaggerated, and there is a serious bubble risk.