Winning the Hardware Software Game Winning the Hardware-Software Game - 2nd Edition

Using Game Theory to Optimize the Pace of New Technology Adoption
  • How do you encourage speedier adoption of your product or service?
  • How do you increase the value your product or service creates for your customers?
  • How do you extract more of the value created by your product or service for yourself?

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currency

  • Traditional currency systems are being assailed from several directions. Some propose digitizing national currencies as a means to decrease transaction costs, facilitate tracking, and discourage illicit uses of currency. Some suggest a single, global currency system is inevitable. Others propose creating non-government-backed forms of currency to eliminate the ability of government to control transactions, as well as to decrease transaction costs and enable anonymity.

    What does the future hold for currency?

    For more information on currencies and Bitcoin, see my previous blog, “Bitcoin: Wave of the Future or Flash in the Pan?”

     

    Why Barter Systems Don’t Work

    Before there were currency systems, the barter system was used by people as a means of directly exchanging one good or service for another. However, the barter system had several fundamental disadvantages, such as

    • Need for Double Coincidence of Wants: Barter transactions can be possible only when two people have goods or services that are mutually useful to each other.
    • Lack of Divisibility: Commodities and services cannot be easily sub-divided to effect an evenly valued exchange.
    • Lack of a Common Measure of Value: Barter systems lack a common measure of value.
    • Lack of Store of Value: In a barter system, value can only be stored in the form of commodities, which do not have a stable value over time.