On a recent podcast with Bill Bymel, we got to talking about Bitcoin, crypto, and my project, ForumPay. I used to be quite a crypto skeptic and unconvinced about the argument that Bitcoin was a store of value. However, a few years ago, I came across an article on the six characteristics of money, which showed how crypto outperformed FIAT currency (dollars, euros, etc.) on five of those points in the sense that it is divisible, portable, durable, etc. But, it seriously underperformed with regard to fungibility. The definition of a currency suggests it is something you should be able to pay your taxes with, a point on which, at least for now, cryptocurrency has some way to go.

Our mission at ForumPay is to make crypto fungible, to help make it a legitimate store of value that can be saved, retrieved, and exchanged without losing value. We are helping thousands of merchants and businesses adopt crypto payments and open their goods and services to a whole new market segment.

So, let’s explore how far Bitcoin has come and what we can expect from Bitcoin in the near future.

What does “store of value” mean?

A store of value is any asset that maintains its purchasing power over time and can be easily exchanged for goods and services. For an asset to be classed as a strong store of value, it should be durable, liquid, and have relative scarcity. Durability ensures the asset doesn’t perish or degrade quickly; liquidity allows it to be easily traded or sold, and scarcity adds value by limiting the supply and making the asset more desirable.

Gold is a good example of a store of value. As an asset, it is durable, liquid, and scarce, as are other precious metals and many kinds of real estate, although they may not be as liquid as smaller, more fungible assets due to the complexities involved in buying and selling. Fiat currencies, such as the dollar and euro, are also considered stores of value. They are used by almost everyone as a means of exchange due to their liquidity and governmental backing. Although they can suffer from inflation and devaluation, these fluctuations tend to be minimal and are controllable through government intervention.

Bitcoin and crypto as a store of value

At ForumPay, we believe that Bitcoin and other similar cryptocurrencies will soon be considered a store of value for several reasons. Despite its relative youth, Bitcoin has demonstrated huge growth since its creation and has in fact, proven itself to be the best-performing liquid asset of the past decade. Critics often highlight its volatility as a major drawback to its fungibility and utility as a means of exchange. But, if we observe its performance over a longer period, Bitcoin’s value has appreciated significantly, a trend many experts believe is set to continue.

Critics also argue that Bitcoin’s scarcity is artificial, which therefore renders it worthless. However, many established stores of value, such as fiat currencies, are also artificially scarce, given that governments are able to simply print more money. Bitcoin scarcity lies in its fixed supply of 21 million coins —some of which have already been removed from circulation indefinitely— making its scarcity immutable.

Bitcoin’s liquidity also plays a key role in it being considered a store of value. Earlier, I used the example of gold’s liquidity, which is considered a store of value. Well, it is much easier to trade with Bitcoin and use it for payment than it is to use gold. More and more businesses are also embracing Bitcoin, thanks to solutions such as ForumPay, which enhance its utility and facilitate borderless transactions. In this sense, Bitcoin could be seen as an even more powerful store of value than FIAT, as it serves as an international means of exchange.

Ultimately, Bitcoin and other similar cryptocurrencies will be considered a store of value if people use and treat them as such. This transition is already underway, thanks to solutions such as ForumPay, paving the way for mass crypto adoption as more consumers, merchants, and businesses recognize Bitcoin as a form of payment with unique advantages.

To find out more about ForumPay, our crypto-to-FIAT payment solution, visit www.forumpay.com.