Abstract
In this paper I discuss Bitcoin’s defining features that make it a unique asset. I argue that Bitcoin should not be considered as a single purpose asset only, but rather as a new digital financial asset serving several function. In addition to functioning as a means of payment (at least partially) and a diversification tool, I argue that part of Bitcoin’s value proposition stems from its worth as a short position on modern expansionary monetary policies. Indeed, Bitcoin’s value should rise if expansionary monetary policies are maintained, amounting to a tool to short these policies, which should be considered in future attempts to value Bitcoin. I discuss the role of Bitcoin in the traditional financial system, contrast Bitcoin to gold, consider the implications of the continuance of expansionary policies on Bitcoin, and discuss the impact of the emergence of cryptocurrencies as a new asset class on public policies.
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