Bitcoin: Between Digital Currency and Financial Commodity

32 Pages Posted: 23 May 2015 Last revised: 7 Mar 2016

See all articles by Maria Letizia Perugini

Maria Letizia Perugini

University of Bologna

Cesare Maioli

University of Bologna - Research Center of History of Law, Philosophy and Sociology of Law, and Computer Science and Law (CIRSFID)

Date Written: November 17, 2014

Abstract

The considerable diffusion of bitcoins over the Internet that took place in the last two years has highlighted some important issue about the use of anonym tools of payment in e-commerce. Even though bitcoins are largely considered to be a digital currency, the legal and economic analysis draws the attention to a concomitant structure of financial commodity with risky features related to derivative instruments making the possibility of a bubble a case to consider. The significant growth in value and the intense volatility characterizing bitcoins are more likely to be the consequence of remarkable investments made by hedge funds and the effect of specific Institutional measures, than the outcome this efficient instrument has achieved on the Internet. The following article is analyzing bitcoins in their twofold nature: the structural considerations we will express are referred to virtual coins in general, whereas the financial evaluation is related to the specific volatility of our analysis target.

Keywords: bitcoin, algorihtm, mining, digital currency, transaction, commodity, speculative bubble

Suggested Citation

Perugini, Maria Letizia and Maioli, Cesare, Bitcoin: Between Digital Currency and Financial Commodity (November 17, 2014). Available at SSRN: https://ssrn.com/abstract=2526472 or http://dx.doi.org/10.2139/ssrn.2526472

Maria Letizia Perugini (Contact Author)

University of Bologna ( email )

Via Zamboni 22
I-40121 Bologna
Italy

Cesare Maioli

University of Bologna - Research Center of History of Law, Philosophy and Sociology of Law, and Computer Science and Law (CIRSFID) ( email )

Via Galliera 3
I-40121 Bologna
Italy

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