Bitcoin Cryptocurrency as Money – a Monetary Analysis by Using the Ludwig von Mises Regression Theorem
Authors- Vladimir Sirkarov
D. A. Tsenov Academy of Economics
Keywords
money, barter, medium of exchange, regression theorem, bitcoin
Summary
Money came into existence on the basis of market relations in the absence of state intervention. The first means of exchange date back earlier than the development of clearly-established structures of public administration. The need for money was generated during an early form of trade, the barter. In general, the actual functions of money cover three general categories: a medium of exchange, a store of value and a unit of account. Money should be a universal force. This does not mean that money can be used by everyone; it requires wide application and sustainability. Ludwig von Mises' regression theorem is a praxeological analysis of the marginal utility of money. It analyzes reaching a historical moment when a commodity becomes a medium of exchange. The emergence of a new medium of exchange is based on an existing pricing mechanism. The subjective monetary value at the moment can be thus calculated. Bitcoin is a medium of exchange, but it still has no universal status. Cryptocurrency does not contradict the regression theorem and has the theoretical basis to turn into money. It depends on the preferences of economic agents whether this will happen or not.
Pages: 14
DOI:
