Author: Wiehann Olivier

Blockchain-based digital assets were once traded primarily by a small group of technology enthusiasts but have since evolved into a multibillion-dollar asset class, now embraced by both institutional and retail investors. According to the Bitcoin white paper released in 2008, the original form of cryptocurrency was designed to facilitate peer-to-peer payments over the Internet without central intermediaries, such as commercial banks or central banks. This innovation leveraged several technological advancements, including the internet, digital signatures, cryptography, and consensus mechanisms. Although initially designed for peer-to-peer transactions, Bitcoin has since evolved into a speculative asset class and a store of value, primarily…

Bitcoin and other cryptocurrencies are seen by many as a new form of money. Others query whether these alternative assets truly meet the definition of money from a practical point of view. ‘Money’ is defined by three pillars being: a store of value; a medium of exchange; and as a unit of account. This latter pillar is the point of contention given the volatility associated with cryptocurrencies such as bitcoin. The volatility of cryptocurrencies made it difficult for users to transact in these cryptocurrencies as the price would fluctuate strongly on a second-to-second basis. This exposed holders of cryptocurrency to…