Properties of Currency
In order for currencies, in their various forms, in order to function as they should, must have three characteristics:
- It must be fungible: A dollar is a dollar, regardless if its in pennies, quarters or an entire bill. Dividing a unit does not diminish the value for being divided, but only divides the value of each fraction.
- It has to be useful as a store of value: It must command some sort of consistent demand over a period of time between receiving and subsequently spending the money. You wouldn't want the money you got paid with today to be worth nothing before you paid all your bills. This is why cryptocurrencies can be used in paying for stuff while not being a good savings vehicle.
- It has to be able to track debt : If multiple parties can agree on the value of a given unit of currency, they can use it between themselves as a way to keep track of how much is owed between them. The USD makes for a great vehicle for international trade because oil prices are priced in USD, and all nations in this petrocapitalist world use crude oil.