Topic: The Definition of Cash (Read 1928 times)

Paying with a credit card is paying with money, but it's not paying with cash. Cash is simply the most liquid form of money. In other words, all cash is money, but not all money is cash.

If 2 persons knows the private key, you consider that both are owning the coins (as a 1-2 multi sig). You can't duplicate coins.
I think that the forms of the asset (digital or physical) is of no importance to consider it a bearer instrument.

I think a bitcoin fulfill your definition pretty well "can be transferred to one person to the next without any record of the transfer and that only one person can be in control of the instrument at a time (although duel control is allowed)".
Even if we can argue on the "any record" part.
What is sure is whoever bears the private key can redeem its coins against goods and services, which is the function of a bearer instrument.

Bitcoin is not a bearer instrument. It would be possible for two people to control the private key to an address that contains unspent inputs (this is a very bad security practice). To say that anyone that is in "possession" of a private key has that amount of "cash" then it would be possible for the entire population to have more then 21mm bitcoin.

In order for something to be in bearer form it needs to be physical, otherwise some authority would need to keep track of who is in possession of the instrument, and therefore it would not be a bearer instrument.

A bearer instrument is something that can be transferred to one person to the next without any record of the transfer and that only one person can be in control of the instrument at a time (although duel control is allowed)

Physical money is not the same as a general bearer instrument though. Bitcoin is a bearer instrument, but is not necessarily physical... Thing that did not exist before. (but you can always print keys on paper)
So cash would be synonym with "bearer instrument", which make sense. I wonder if company's shares to the bearer or bearer bonds were considered cash though, it should have been.


This is interesting to see that Window2Wall and countryfree seems to agree when you are both using two different definitions.
Window2Wall use "bearer instrument" definition (definition 2)
You are using "physical" definition (definition 1)

Like I said, I think the problem is that bitcoin is at the same time bearer instrument and non physical. This never happened before.

Your spirit guide.

This is true. Cash is generally considered to be any form of money that is a bearer instrument, usually in paper form (although technically coins are still cash, but may not be referred to as cash)

"Owned by the bearer" doesn't mean anything, it's the physical part which matters. Both of your definitions are wrong. A 1$ bill lost on the pavement obviously doesn't belong to any bearer, but it's still cash, isn't it?

Not being physical, BTC isn't cash.

cash is a payment method in a trading activity between buyers and traders, usually with a cash payment method makes everything is faster and easier, there is still a shortage of excess reversed if we pay in cash, the money that we have will be quickly exhausted, so spending plans we have to really mature ... 

Monero is definitely "more cash", when people think about cash they think about what we all know. There is a lot of effort being put into washing Bitcoins, if you sold your weed or whatever with Monero, you wouldn't need to invest in washing methods and potentially get scammed. It's unfortunate that people don't get the potential of Monero. Both BTC and Monero have its own uses.

Definition of "cashness" = being able to make any any song sound cool.

Define cashness as the probability someone call your money "cash" given the definition X of it. And there is 2 different definitions. (3 if we count FederalReserveofWIP's one)

Here's your problem. Cashness is an adjective. Cash is a noun. For example: being human does not make one humane. You made up the word. You can make any meaning you want.

I did not argued with that, all instrument used as medium of exchange can be considered money. The discussion is on what "Cash" means, and not every money is cash. A USD in a bank account is not the same as a USD on a bill, and I was wondering : which particular aspect make you qualify as "cash" one and not the other ? Is it the physical aspect, or the approval by third party during an exchange ? Given the two widely spread definition, Bitcoin might or might not be considered as cash.

So it is a third definition, liquidity being what define "cashness".
However, a USD in your bank account is still highly liquid, but no one would qualify it as cash.
According to your second definition of liquidity, both, a dollar bill and a USD in a bank account are highly liquid, even more than Bitcoin.

This argument also hold with "Where bank account USD are interesting, is that in some ways, it is more liquid than cash, specifically over the internet (card, wire transfer)". But you don't consider USD in banks as cash.

Then you explain that liquidity depends on geographic location and time, which is true.
However, I'm not sure "cashness" is related to liquidity. Because take a 5 USD bills, against 1000 Yen.
If you are in Japan, then the yen is more liquid that the USD, however I would not say that Yen is more cash than my USD bill.

According to your first definition of "liquid" yes, according to the second, no. You are using the same word for two different things.

In the definition you gave of "cashness" I think "the amount of time and effort that it takes to complete a transaction" fit better.
However, imagine that a killer app and standard come in the banking industry, that would permit two persons to exchange "credit USD" as easily as bitcoin and worldwide, you would still not consider it as cash. (credit USD = USD in bank account)

Because of that, I still think "cashness" is the ability for money to be exchanged without third party approval.
The more a third party can prevent the transaction from happening, the less "cashness" has the money.

"All money is money" - Fifty Cent
Cash is a noun. So what's more money for some is never enough for others.  Monero has what I consider to be security problems, but also strengths. Bitcoin's strengths and weaknesses are well known.

I would suggest that one of the distinguishing characteristics of cash is that it is highly liquid.  This has two senses.  Firstly, the amount of time and effort that it takes to complete a transaction, and second, the extent to which finding a "buyer" for the transaction is possible at all.

Regarding the first point: if you hold paper banknotes, this is one of the most liquid examples of value that exists.  There really is no waiting to have them transferred or accepted, assuming it's an accepted currency in the area.  You can do it in person in seconds, any time, day or night, with anyone (who accepts that currency and denomination, which would be most people in an area in which it is in use), and with no loss in value.

In this sense (traditional) bank accounts are inherently less cashlike than printed bank notes, if only slightly, because it takes some time to make a transfer, your bank card itself is not going to be accepted by just anyone (only some merchants), and it is inherently less liquid.  Where bitcoin is interesting is that in some ways it is more liquid than cash, specifically, over the Internet.  It is faster to make a transfer across the world 'instantly' via bitcoins, than by somehow trying to get the paper banknotes across the world, and much faster than completing a wire transfer (which may also be reversed).  On the other hand, when dealing with someone in person, it takes longer to receive a bitcoin transaction and confirmations than to physically be handed banknotes and make any required change, though the difference is not much.  So in terms of the speed of a transaction by someone who accepts both banknotes and bitcoins, bitcoin is slightly less cashlike.

There is a second factor to liquidity, however: not everyone accepts bitcoin for everything, so it is less liquid due to acceptance.  To get value back out of bitcoins you have just received, you need to find a specific "buyer."  To get value back out of U.S. dollars you just received, you can immediately spend them anywhere, assuming you're in an area that uses U.S. dollars, with no loss of value.  It's perfectly liquid.  In this sense, of course, Euros are less cashlike in the United States than they are in Europe, and dollars are less cashlike in Europe than they are in America.  That is somewhat of a silly distinction - to say that dollars are more so cash in America than they are in Europe.  But it does make sense to sometimes think about it this way.

And, surprisingly, we must conclude that bitcoins are more cashlike over the Internet than $100 bills are.

Chairman of the Federal Reserve of WIP

You misread, I never considered money in bank account as cash.
If you consider the physical part important for the definition (in other words "owned by the bearer"), then bitcoin is not cash.
If you consider the third party approval important for the definition, then bitcoin is cash.


It did not. Milton Friedman spoke about what is now called Bitcoin "cash" in 1999. (satoshi's definition, cash meaning "without third party approval")


I assume you are using the second definition.
I don't know Monero, if it does not require third party approval to make a payment, then it is cash as much as bitcoin.
However, if it makes it impossible to create blacklisted coins (as marcus_of_augustus pointed out), then I would say that Monero is more cash.

A dollar bill in circulation might have his ID blacklisted. However, such ID being almost never checked by merchant, I don't consider it impact severely the "cashness" of dollar bills.
However, Bitcoin is another story since blacklisting of coin can be enforced by bitcoin hardware/software approved by the state. Which might potentially make its "cashness" lower than a dollar bill.

Whats more cash: Monero or Bitcoin?

You forgot the "physical" part. Money at a bank account isn't cash at all, cash is something you can hold in your hand.
If you travel to North Africa, there are small towns without a single ATM, nor a single shop which accepts checks or credit cards. So if you don't have real cash there, physical cash, you just die.

Agreed. One thing I know is the definition of what cash is is changing and bitcoin has re-wrote the riles. I guess cash usually refers to something physical, but you can still spend fiat digitally and it's not really considered cash but it is obviously still money.

So you are using the second definition.


Ahah, this is important to know about what a politician is talking about, they are adept of this kind of meaning manipulation.
"Terrorism" is such an example, the definition is different on the tongue of the politician and of the people.
The purpose is either to create division between people that are in fact talking about different things without knowing it, or either to make a dissident agree with you, not knowing you speak of a different thing.