If Bitcoin does not fit his money definition, then what does Ron Paul define as money?
Concerning money definitions, I`m with Murray Rothbard:
"This process: the cumulative development of a medium of exchange on the free market - is the only way money can become established.
Money cannot originate in any other way, neither by everyone suddenly deciding to create money out of useless material, nor by government calling bits of paper "money".
For embedded in the demand for money is knowledge of the money-prices of the immediate past;
in contrast to directly-used consumers`or producers`goods, money must have pre-existing prices on which to ground a demand.
But the only way this can happen is by beginning with a useful commodity under barter, and then adding demand for a medium for exchange to the previous demand for direct use (e.g., for ornaments, in the case of gold).
Thus, government is powerless to create money for the economy; it can only be developed by the processes of the free market.
A most important truth about money now emerges from our discussion:
money is a commodity. Learning this simple lesson is one of the world`s most important tasks.
So often have people talked about money as something much more or less than this.
Money is not an abstract unit of account, divoceable from a concrete good; it is not a useless token only good for exchanging; it is not a "claim on society"; it is not a guarantee of a fixed price level.
It is simply a commodity. It differs from other commodities in being demanded mainly as a a medium of exchange.
But aside from this, it is a commodity - and, like all commodities, it has an existing stock, it faces demands by people to buy and hold it, etc.
Like all commodities, its "price" - in terms of other goods - is determined by the interaction of its total supply, or stock, and the total demand by people to buy and hold it.
(People "buy" money by selling their goods and sevices for it, just as they "sell" money when they buy goods and services.)
Now, if you agree to that definition, is Bitcoin money?
It evolved from the free market, even though its first, very small, value was assigned to it not because of being a commodity (which it definitely is not!), but because people recongized its unique value as a medium of exchange. Everything else applies, it even has a limited stock.. I think its a very tricky question, and I can`t come to a definitive answer for myself.
But I like it anyway
