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Gold isn’t money, silver isn’t money and I don’t think Bitcoin will ever be used as money. To be fair I don’t think gold and silver will ever be money again–not in a digital world.

What is money? “Money is a commonly used medium of exchange. People wishing to achieve their ends often have to trade. They can exchange their goods directly, if they have matching preferences and suitable goods, or indirectly, with the help of another good, the medium of exchange.”


They key word in the above definition is commonly used.

Bitcoin is very expensive to transfer and it is slow. For large sums of money it is comparable to a wire transfer. But for day to day transactions Bitcoin simply doesn’t deliver.

“The standard set by the Bitcoin community is six transfer confirmations before it is complete. Each confirmation can be expected to take about 10 minutes, thus getting an average of one transaction per hour.”


The fees are also not cheap. The cost is based on a variety of factors but according to this calculator a transaction would cost between $5-10 at the time of this writing.


That’s a bargain if you want to transfer large amounts (say $20,000 or more) of value outside the banking system but not great if you’re buying a coffee.

On a volume perspective Bitcoin is somewhat archaic. It can process about 20,000 transactions per hour. Compare this to Visa, which can process 65,000 transactions per second.


So unless Bitcoin becomes transactions become dramatically faster, cost less, and allow for more volume. It is difficult to see how Bitcoin would ever be used as money.