Is Bitcoin a Currency?

Is the granddaddy of crypto actually a currency? That’s one heck of a question, especially since many have touted it as exactly that. Bitcoin was supposed to be this decentralized thing that would allow regular people to buy and sell independently of any government system and its fiat currency. However, the way things have developed have prompted many to ask what Bitcoin actually is. Is it a currency, a commodity, or an asset? 

Well, it definitely is not a commodity. A commodity is a tangible good that can be used to actually make things. Its value comes from its usefulness and how much value society places on that use. Bitcoin by its nature is not tangible and can’t actually be used to make anything. 

What about currency? It is called a cryptocurrency after all. Yet, what makes something a currency? It has to be easily transported and transferred to another party at little or no cost. In a sense, Bitcoin is easy to transport because it is strictly digital. You can carry the code or the password to your Bitcoin account around with you in your pocket. However, transferring it is difficult. It actually costs far too much money in electricity and fees to move it from your account to another to justify using it to make purchases. Imagine buying a $1.50 cup of coffee for two hundred dollars just because of all the transfer costs. Not that buying such a small item with it is even possible. Bitcoin can only be divided so much, and given the value of a single Bitcoin, even a Satoshi (the smallest Bitcoin unit) is worth over three dollars as of this writing.

That leaves its value as an asset. Anyone who bought Bitcoin ten years ago, or even two, and seen the value of their investment skyrocket in the time since will definitely attest to the currency’s value as an asset. If you dropped two hundred on it ten years ago and cashed out today, you would definitely be a millionaire several times over. In a way, it is even better than gold. This is because while that shiny rock does a great job storing value, it doesn’t really increase in value. What does that mean? Basically, you can use the same amount of gold to buy a suit today as you would have used fifty years ago. While it is worth more dollars than it was then, that’s only because the dollar is worth less. Yet, the value of gold remains the same, with minor fluctuations. 

Bitcoin however is currently increasing in dollar value at a pace that far exceeds inflation, making it a better investment for growth. At least for now. It has proven exceptionally volatile, increasing or decreasing in value by tens of thousands based on tweets from certain high profile people, or a government policy change. 

How did we get to that point? Why did Bitcoin reach a point where it isn’t a currency, and probably never will be? How did it become a valuable but volatile digital asset? Because it wound up being tied to the U.S. dollar. It didn’t necessarily need to be tied to the dollar but the investment behavior of many drove the public perception in that direction. As soon as people started talking about it in terms of dollars, the die was cast and now the coin that started it all is inextricably linked to a centralized fiat currency. Which in turn means that Bitcoin is now a centralized asset, though it is supported by a decentralized network. 

Perhaps the people behind Bitcoin dreamed too big. Maybe they didn’t understand the dangers of putting it out for everyone right away. It might have been different if that had begun smaller, in a specific ecosystem. 

TARTLEcoin for example is meant for use within the TARTLE ecosystem. It is something that anyone can earn through simple actions and can be easily transported and transferred in a matter of seconds at extremely low cost. It even has a specific value in that each one grants you priority when buyers are looking for data too. Everyone can access and use it and everyone knows exactly what it is for. Perhaps this will be a better way, one that avoids the dollar trap.

What’s your crypto worth? www.tartle.co