Difference between revisions of "Ideal Properties of Digital Commodities"

From Bitcoin Wiki
Jump to: navigation, search
(No difference)

Revision as of 16:39, 25 January 2011

Inspired by the thread: http://www.bitcoin.org/smf/index.php?topic=2966.0

Ideal Properties of Decentralized Digital Commodity

If we had the ability to design and implement an ideal form of digital commodity money, what would it look like? How does Bitcoin currently compare?

Property Ideal Implementation Bitcoin's Current Rating (A..F) Notes
Decentralized no single point of failure or issuing authority A.
Scarce required to be a reasonable store of value A.
Divisible should be as close to infinitely divisible as possible B.
Storage actual commodity should be cheap and easy to physically store securely A.
Irreversible Transactions transactions should be irreversible A.
Anonymous untraceable transactions (if desired) C. currently requires some trusted third party to obsfucate transactions
Unspoofable should be exceedingly difficult to counterfeit A.
Audit** publicly auditable balances, with account holder's permission C. since permission is not required
Free Transactions transactions should be free, or nearly free, forever B bitcoin future tx fees are a big unkown right now
Unique Use-Value? ideally a commodity should have a unique non-monetary use-value F currently there is nothing you can do with bitcoin that you cannot do with a national currency
Offline Transactions ideally two participants should be able to safely transact without requiring internet access or trust of one another (like normal cash) D seems quite impossible in the current bitcoin implementation

\**May not be a necessary property. Thinking it would be cool if a known address could be audited via a tool like blockexplorer.com but if the coins are moved from that address, they are untraceable.