Money, Ledgers & Bitcoin

Role of Money

• Store of value: one dollar today is worth one dollar tomorrow
• Unit of accounting: prices are expressed in dollar mount
• Medium of exchange: willing to accept money as payment

Ledger

• A way to record economic activities and financial relationships

Types of Ledger

• Tranasaction vs. Balance
• General Ledger vs. Subledger (Federal Reserve/Central Bank vs. Commercial/Local banks)
• Single-entry vs. Double-entry (asset & liability or debit & credit)

Fiat Money

• Fiat money does not have intrinsic value but is backed by the good faith and credit of the government that issued it
• Represented the LIABILITY of a central bank
• Relieds upon a system of ledgers
• Can be used to pay taxes
• It’s a legal tender: what is acceptable to settle a debt; can vary in different jurisdictions