Answer to Question #127283 in Macroeconomics for sara

Question

Investopedia.com explains that “Bitcoin is a digital or virtual currency created in 2009.” Is Bitcoin money? Explain

Answer 1

Bitcoin is money. This is because money is an economic units that is used as a medium of exchange. It is also used to reduce transaction cost also known as double coincidence of wants. Money can be market determined , legal or fiat money, money substitute and fiduciary media, and electronic cryptocurrencies. Bitcoin is a digital or virtual currency considered as the original cryptocurrency. Bitcoin is used as a medium of exchange and also to reduce transaction cost, therefore, Bitcoin is money.