Abstract
Purpose: The aim of the article is to attempt to assess the phenomenon of digital currencies through the prism of existing money definitions as well as to determine to what extent the existing definitions of money are able to answer the question whether private decentralized digital currencies are money in the traditional sense or are they a completely new phenomenon that cannot be put in the framework of previous definitions of money. Design/methodology/approach: This study provides a critical literature review of the cryptocurrency’s definitions in comparison to traditional money definition. The literature review was intended to determine whether bitcoin could be treated as money. Findings: The findings indicate that all the cryptocurrency definitions quoted in this study demonstrate that bitcoin together with other cryptocurrencies have ceased to be a niche phenomenon as at the time of the definitions being published and that in no way can the novel trend already marked across the world be ignored by pretending it simply does not exist. Originality/value: This article intends to cover the gap observable in the current scientific discourse in the relations between the notions of classic money and digital currencies.
Highlights
The phenomenon of cryptocurrencies cropped up only recently in the universe of contemporary finance
The actions required the usage of nonstandard monetary policy tools, altogether termed quantitative easing (QE)
The quantitative easing policy was later on continued by other central banks being of importance for the system - the Bank of Japan (BOJ) and the European Central Bank (ECB)
Summary
The phenomenon of cryptocurrencies cropped up only recently in the universe of contemporary finance. The origination of this prodigy in 2009 was an outcome of a crisis that had broken out on the world’s financial markets. In order to save the world’s financial system, unprecedented and yet resolute actions had to be taken. The actions required the usage of nonstandard (at that time) monetary policy tools, altogether termed quantitative easing (QE). Putting it plainly, they comprised in printing and introducing to the world’s monetary system tremendous amounts of new money (at a rate of several dozen billion USD per month).
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