The news article discusses how Bitcoin can be utilized as a medium of exchange, a store of value, and a unit of accounting. It states that Bitcoin can be used to price various items, such as the cost of an iPhone 15, or even the market capitalization of fiat currencies worldwide. Interestingly, cryptocurrency service providers already use Bitcoin as the unit of accounting to price other assets.
The article mentions that CoinMarketCap compares Bitcoin’s market value by pricing the market capitalization of major fiat currencies in BTC. To do so, the platform multiplies the current price of a given fiat currency with its circulating supply, which is usually reported by the respective central bank. The top 20 fiat currencies have a market cap greater than Bitcoin’s circulating supply, with the Vietnamese Dong being the closest one in terms of market cap.
In terms of specific fiat currencies, the Chinese Yuan (CNY) has the highest market cap, followed closely by the United States Dollar (USD). The market cap of the Yuan is over 1.42 billion BTC, which is 72 times larger than Bitcoin’s market cap. Similarly, the USD has a market cap of 1.26 billion BTC, which is 64 times higher than Bitcoin’s available supply. Despite having a smaller circulating supply compared to the Yuan, the USD reaches a significant market cap in BTC due to its trading price. Other fiat currencies like the Euro, Japanese Yen, and Pound Sterling also have substantial market capitalizations in BTC.
In summary, Bitcoin’s versatility allows it to serve as a medium of exchange, a store of value, and a unit of accounting. The article highlights how Bitcoin is used to price various assets and compares its market value to major fiat currencies. Despite the significant market caps of fiat currencies, such as the Chinese Yuan and United States Dollar, in BTC, Bitcoin’s unique properties continue to make it an increasingly influential cryptocurrency.
