Bitcoin isn't real money. Why not?

Let's take a quick look at some of the hallmark characteristics of what we consider money.

1. Transferability

Can I move it around, and transfer it from myself to another party and vice versa? Yes.

Bitcoin is far more transferable than traditional fiat currencies (like the physical dollar, euro, and yen)... And it works just as well as any mobile transaction. I can open my phone and securely transfer $100,000 of bitcoin (or more) straight into your digital wallet in an instant.

Of course, you can hand me $100,000 in cash in a briefcase. But I'd need to count it, and check that the notes aren't counterfeit. And then I'd need to secure it. The bitcoin blockchain does all of the above for me. Once I've made the bitcoin transfer and you've seen the balance in your wallet, it's done. That's it. You own those bitcoins.

1. Usability

Money isn't much good if I can't use it. Can bitcoin be used to buy goods and services? Yes, and increasingly more merchants are accepting bitcoin as a means of payment.

Incidentally, as I write this, I'm scheduled to meet with the CEO of a company that is launching a service allowing you to spend your bitcoin the same way you would use a simple debit card. And you can use this service at more than 30 million locations globally.

Mainstream acceptance is growing every day. Bitcoin is already legal tender in Japan.

1. Scarcity

Central banks can, have, and continue to create tens of billions of dollars in fiat currency out of thin air. And as a result, currencies the world over collapse, time and again.

Try talking to folks in Venezuela about how much faith they have in the bolivar (the national currency), now essentially worthless. Or Zimbabweans, whose currency collapsed after hyper-printing by their central bank. Or the 1 billion-plus people in India who had their cash lifesavings declared no longer legal tender in an instant last year, when Prime Minister Narendra Modi made a surprise televised announcement informing them they had until the end of the year to exchange their notes for new ones before they would become worthless.

The West is truly spoiled when it comes to relative currency stability versus the rest of the world.

As for bitcoin, only 21 million will ever be minted – according to the bitcoin protocol – and only around 16 million are in circulation today. No central bank or government can "print" more bitcoin.

And as for the concern that bitcoin is purely "digital," it's worth remembering that more than 90% of all money that exists today around the world is not physical (i.e. not notes or coins).

When you're buying bitcoin, you're taking a view that more people around the world will accept bitcoin as a form of money. And with a total market cap of around $300 billion, I think it's a worthwhile view to take.