Random Blog on Crypto (Part 35) : Is Crypto is an Asset or Currency (Part 3)
Those who followed my previous two posts in this Random Crypto series saw that I discussed the characteristics of cryptocurrencies. I have discussed what characteristics of assets have in common with cryptocurrencies in part one and in part two I have discussed the similarities between cryptocurrencies and currencies. Many people are a bit confused from the discussion of these two posts because the two posts discuss the features with extensive arguments in two areas. In today's post I will try to give a summary of those two posts and a conclusion from my side. Although this is purely my personal opinion, I still want to draw a line between these two dilemmas.
The nature of cryptocurrency is totally diverse. It is similar with trading and currency. It can be used for investment and trading both. So the characteristics is unique in the financial system. This is hybrid nature. And this hybrid nature sometimes help them to use as currency and sometimes as like investment. So I think the name crypto just before the currency is the unique name and which poses both the characteristics of currency and asset. So the cryptocurrency is not in the category of these two rather it itself is a category. The classification should be in 3 categories like currency, asset and cryptocurrency. This is my personal opinion because the use is possible in both the cases.
The classification of cryptocurrencies as assets or currencies depends on context. Cryptocurrencies are a new financial instrument that challenges traditional categorizations. With the change of technology advancement the classification should be changed. As the technology evolves and regulatory frameworks develop, the classification may continue to evolve as well. It's important to note that the classification of cryptocurrencies can have significant implications for taxation and regulation. Different taxation and regulation policy should be developed for cryptocurrency I believe.
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You have done a great analysis on Cryptocurrencies. After going through this all the people will be able to understand the different on assets and cryptocurrencies as well as the behavior of crypto as an asset or a cryptocurrency. Thank you very much for this valuable article.
Some People call crypto an asset and some call currency so the person to person the opinion is different. But It is both an asset and currency.
Nice blog from you, nice to see your third post on this, indeed I believe just like you pointed out whether cryptocurrencies is an asset or currency is merely from context. It's an investment scheme since it offers hope of higher to its investors and a currency since it used for exchange of goods and services.