Is Cryptocurrency Money?: Three Empirical Studies Analyzing Medium of Exchange, Store of Value and Unit of Account

Abstract

Cryptocurrencies, such as Bitcoin, Ethereum or Ripple, are discussed as a new form of money. Typically, money fulfills three core functions: 1) medium of exchange, 2) store of value, and 3) unit of account. To examine whether individuals consider cryptocurrencies as money, we conduct three studies. Study 1 (N=57) provides valid and reliable measurement items for the three core functions of money. Study 2 (N=95) shows that the general perception about the fulfillment of the core functions is rather positive for cryptocurrencies. The results from Study 3 (N=99) furthermore reveal that Bitcoin is perceived significantly better in fulfilling all three functions than Ethereum or Ripple. The findings suggest that cryptocurrency research needs to include or at least control for the basic perceptions of core functions when examining individuals' adoption or use of cryptocurrency as money. Furthermore, the findings suggest that existing knowledge from Bitcoin use or adoption research cannot be easily transferred to the context of another cryptocurrency.