For the longest time now financial institutions have had debates on whether crypto currencies are legal or not. The discussion begins with finding out whether bitcoins are a currency or not. Their intangibility nature is part of the reasons why many people think it is a bubble which will burst after absorbing enough people into its culture. Governments are in fact warning their citizens on using these forms of payment however you need to do the research by yourself to know what is true and what is not. There are various attributes of money that help in its definition as a currency. The reasons below are some of the justifications as to why qualifies to be used as currencies today and why platforms like Bitcoin trader.ai are getting popular.
Scarcity
The supply of the money in an economy is the determinant of its value ultimately. There needs to be controlled production and distribution of money into the economy for the value to be maintained. You should know that increased production of bitcoins can make its excess in the economy which consequentially reduces its value during trading. You may therefore go at a loss in case you buy bitcoins for slightly higher than the amount you sell them with. Under production of bitcoins is also another factor to keep in mind because it makes the bitcoin amount in circulation to be limited hence the increased value. This is the best time to sell your bitcoins had you invested in the same because you are likely to make a lot of profits.
Divisibility
Successful currencies are those which can be divided into denominations. The value of services and products you purchase will vary based on what you want and the seller you get it from. A currency that cannot be divided returns the market to barter trade system where indivisibility led to a lot of losses in the operations. A good currency can easily be divided into reasonable denomination that can be used to make small payment for instance when paying for meals in a hotel. Before being widely accepted as a currency, it ought to be able to represent the value of all goods and services which exist in the market.
Utility
Initially, traditional markets had to rely on using barter trade to get what they want. Lack of double coincidence of wants and such challenges made it difficult for trade to continue hence one common medium of exchange was needed to make trade efficient for everyone. Without utility, a currency will be unable to be of any use in the market in which it exist in. the currency ought to have value and be accepted by the people using it as currency. Utility of currencies also demand currency can easily be moved from one area to the other without any challenge. Transporting metallic money for instance gold was a little hard due to its bulkiness in nature and increased insecurity in the world today. Bitcoins can however be easily transported to various platforms and even shared online to make work easier for factors like online shopping.
Transportability
This is not just about getting money from one location to the other; transportability refers to the ability of the currency to survive exchange between different countries for trading purposes. The medium of exchange needs to be accepted by the economy of different countries before you can fully certify it to be a currency. Luckily for you, bitcoins are universal options which can work in different countries without having to be exchanged to another form of currency. The spicetokens is one of the most popular bitcoin cash blockchain in the world.
Durability
The survival of a currency is mostly based on the quality of the material used to make it. It is therefore absurd to expect currency in notes and coin form to last forever. Their durability is affected by wear and tear from all the handling and mishandling that is experienced. Bitcoins are digital money which can be used in facilitating transactions for a very long time. They are intangible and stored online meaning you can access them as you wish without having to physically handle the currency. This reduces the need for replacement of old bitcoins because they do not get old. This is a reliable currency considering you can store it for however long you want.
