ETHERLive
ETHERLive delivers real-time price and volume data across 16+ exchanges to users in a clear and easy-to-understand package. Users can get up-to-the-second updates for each exchange/currency pair, as well as aggregated market averages for each exchange, currency, and the market as a whole. It also provides a global converted average of all the currency pairs monitored by ETHNews, converted to USD.

---

24hr ---
--%
Thursday Dec 14th 2017
RESOURCES

The Basics

Learn the basics of Ethereum and various cryptocurrency technologies

Learn More

What is Ethereum?

Understand the underlying principles of the Ethereum Platform

Learn More

The Blockchain

Discover the revolutionizing technology known as the blockchain

Learn More
SUBMIT

Press Release

Submit a press release for consideration on ETHNews

Submit Press

Story / Dapp

Submit a story or DAPP to be considered for publication on ETHNews.

Submit Story

Explanation

Submit "Ethereum Explainer" content for consideration to be featured on ETHNews

Submit Topic
ETHNews Logo
---
--%
Home
News
Etherlive
Ether Price Analysis
Resources
Contact Us

Putting the 'Currency' In Cryptocurrency

By

Matthew

De Silva

WriterETHNews.com

Volatility has a real effect on the use of virtual currency. Will bitcoin become a medium of exchange or a “store of value?”

Today, ex-hedge fund manager Michael Novogratz offered his take on cryptocurrency in an interview with Bloomberg. Novogratz professed that cryptocurrencies are not currencies. His reasoning? Volatility.

“For something to be a currency, you need stability,” he said. “When you step back and walk away from the screens, [the] dollar-yen [exchange rate] has been plus or minus 15 percent for much of the last 15 years. The euro [has been] the same way.”

Volatility certainly impacts people’s confidence in an asset. That’s part of why our society differentiates between blue chips and penny stocks. Through the lens of stability, we’re able to understand which assets we can trust and which are more speculative in nature. But stability doesn’t tell the whole story.

Stability is a feature of a dependable currency, not all currency. Novogratz’s assertion is not entirely accurate, as evidenced by hyperinflation experienced in countries like Brazil and Zimbabwe, but he’s mostly right. It’s hard to predict how much a bitcoin will be worth an hour from now, let alone a week or a year down the road. On that basis, why would people spend their “digital gold?”

Noting bitcoin’s function as a “store of value” and the cap of 21 million units (notwithstanding hard forks like bitcoin cash), Novogratz suggested that the price of bitcoin will continue to rise. When interviewer Erik Schatzker asked, “how high?” Novogratz sighed and neglected to provide an estimate.

Analyzing attributes like the total supply, circulation, existence of a cap, and rate of issuance might provide small insights into the viability of a cryptocurrency. Additional factors might include the rate of coin destruction and the potential for market manipulation if an individual or group possesses vast amounts of the currency. Ultimately, in all its forms, money remains a collective fiction. While tokens on a blockchain like Ethereum may provide utility on a platform, it’s unclear whether non-fiat cryptocurrency will be sustainable in the long run, either as a currency or as a store of value.

Matthew De Silva

Matthew is a writer with a passion for emerging technology. Prior to joining ETHNews, he interned for the U.S. Securities and Exchange Commission as well as the OECD. He graduated cum laude from Georgetown University where he studied international economics. In his spare time, Matthew loves playing basketball and listening to podcasts. He currently lives in Los Angeles. Matthew is a full-time staff writer for ETHNews.

ETHNews is commited to its Editorial Policy

Like what you read? Follow us on Twitter @ETHNews_ to receive the latest currency, volatility or other Ethereum opinion news.