Satoshi Notebook | Properties of Money

Properties of Money

money requires specific properties to function effectively as a store of value, medium of exchange, and unit of account. these properties are not arbitrary - they emerge from the fundamental requirements of human coordination and value transfer.

Durability

money must maintain its properties across time:

       • resistance to physical degradation

       • persistence across time

       • immunity to decay

       • stability of form

       • maintenance of integrity

Divisibility

money must be separable into smaller units:

       • subdivision without loss of properties

       • consistent value ratio between units

       • practicality in small transactions

       • precision in measurement

       • scalability across transaction sizes

Portability

money must be easily transported:

       • high value-to-weight ratio

       • ease of physical movement

       • efficiency in transfer

       • minimal transport cost

       • convenience in carrying

Scarcity

money must maintain limited supply:

       • difficulty of production

       • resistance to inflation

       • controlled supply growth

       • natural or enforced limits

       • protection against debasement

Fungibility

money must be mutually interchangeable:

       • uniformity between units

       • identical value per unit

       • no meaningful differentiation

       • universal acceptance

       • perfect substitutability

Verifiability

money must be easily authenticated:

       • simple authenticity checks

       • resistance to counterfeiting

       • clear identification

       • reliable verification

       • immediate recognition

Acceptability

money must be widely recognized and accepted:

       • universal recognition

       • cultural adoption

       • merchant acceptance

       • network effect

       • social trust

Perfect Integration

these properties cannot exist in isolation - they must work together in perfect harmony. the failure of any single property compromises the entire system.

true money achieves the ideal balance of all these properties simultaneously, creating a reliable system for storing and transferring value across time and space. each property reinforces the others, creating a robust and effective monetary system.