Is Bitcoin a property, a commodity, or a currency?

On November 1, 2008, a mysterious person named Satoshi Nakamoto published a paper titled Bitcoin: A Peer-to-Peer Electronic Cash System, describing an electronic currency he called "Bitcoin" and its algorithm. In 2009, he released the first Bitcoin software and officially launched the Bitcoin financial system.

The question is, can you define Bitcoin in one word?

On September 18, 2015, the U.S. Commodity Futures Trading Commission (CFTC) released a PDF document, which determined that the answer was commodity, requiring companies engaged in digital currency derivatives trading to register and be regulated by it. Mainstream media such as Tencent Finance reported that "Bitcoin's status has been upgraded, and the U.S. government has confirmed its commodity status."

What is Bitcoin in the eyes of mainstream readers? Here are some comments from readers on Tencent:

The comments are almost all negative,骗局and阴谋being the main keywords.

In fact, this is not the first time that a US government agency has defined Bitcoin. As early as March 26, 2014, the US Internal Revenue Service (IRS) issued an official statement, treating it as a Property for the purpose of imposing taxes on Bitcoin.

On August 8, 2013, a U.S. federal judge ruled in a lawsuit that Bitcoin should be currency and all matters related to it should be subject to regulation by the U.S. Securities Act.

Have you found the problem? The definition of Bitcoin in the United States is actually very complicated. Different institutions have completely different recognition results. Of course, each institution also defines Bitcoin from its own perspective. The author personally thinks that starting a Bitcoin business in the United States is actually a very painful thing, because there are all kinds of regulations waiting for you to apply.

But we can also see from this that the recognition of Bitcoin by various US agencies is slowly pushing digital currency towards legalization.

Bitcoin in the eyes of the Chinese government

So what is the definition of Bitcoin in the eyes of the Chinese government? As early as December 5, 2013, the People's Bank of China and five other ministries and commissions issued the "Notice on Preventing Bitcoin Risks", defining Bitcoin as a specific virtual commodity that does not have the same legal status as currency and cannot and should not be circulated and used as currency in the market, but ordinary people have the freedom to participate under the premise of assuming their own risks. On April 11, 2014, Zhou Xiaochuan, the governor of the central bank, once again emphasized: "Bitcoin is a tradable asset, not much like a payment currency. For example, stamps and the like are mainly collectibles."

This is an official notice that the Chinese government has imposed restrictions on digital currencies, including requiring financial institutions and payment institutions not to price products or services in Bitcoin. But when it comes to legislation, unfortunately, I haven't seen any so far.

That is to say, in the eyes of the Chinese government, Bitcoin is a restricted commodity.

It is trash in the eyes of outsiders, but it is regarded as life in the eyes of die-hard fans.

My father is a typical elder generation thinker. One day, I asked him what Bitcoin is. He replied, "You can't see or touch it. What kind of commodity or currency is it? It's just a string of code. It has no value."

However, there is a group of people in this world who have exchanged most of their assets for Bitcoin. "Rickard Falkvinge, founder of the Pirate Parties, has even crazily exchanged all his savings for Bitcoin. There is also a strange report that Luxembourg programmer Felix Weis has been traveling around the world with Bitcoin for 8 months.

You may say that these are too much nonsense! Then let me give you another example. Xingkong, the founder of the domestic Bitcoin company HaoBTC, has 99% of his assets in Bitcoin. If you don’t believe it, you can verify it yourself.

Things about Bitcoin applications

So what can Bitcoin be used for? At present, the most common use of Bitcoin is for speculation, followed by dark web transactions, and then gambling. Relatively speaking, the proportion of truly legal merchant transactions is relatively small.

So the question is, what kind of things can meet all of the above applications at the same time?

Is it appropriate to use soybeans for gambling? Is it appropriate to use houses to buy Microsoft virtual goods? Is it appropriate to use RMB for speculation?

So if you ask me, if I were to define Bitcoin in one word, it would be “bullshit”. It fits everything and is everything.

Having said all of the above, can we explain what Bitcoin is? To be honest, what we have said above is just the tip of the iceberg. The lowercase bitcoin refers to the Bitcoin token, not Bitcoin.