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Argument by false analogy: The mistaken classification of bitcoin as token money
preprintposted on 2019-02-19, 10:52 authored by Alistair MilneAlistair Milne
This paper investigates a distinction in recent literature between digital ‘token’ money (Bitcoin is supposed to be an example) which passes directly between holders and account-based money which does not. This distinction is based on a false analogy between cryptocurrency and physical cash. Cryptocurrency like bank money is account-based; cryptocurrency payments are validated by reference to account holdings, they are not a virtual object; commercial bank money (not cryptocurrency) has token characteristics, representing a claim on something else. This clarifies the current discussion of central bank issue of digital currency: the issues involved become conceptually very simple not conceptually complex.
- Business and Economics
CitationMILNE, A., 2018. Argument by false analogy: The mistaken classification of bitcoin as token money. Available at SSRN: https://ssrn.com/abstract=3290325
- SMUR (Submitted Manuscript Under Review)
Publisher statementThis work is made available according to the conditions of the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0) licence. Full details of this licence are available at: https://creativecommons.org/licenses/by-nc-nd/4.0/
NotesThis is a working paper and is in closed access.