Is Ethereum a monetary unit?

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The classification of Ethereum (ETH) as a monetary unit is nuanced. Several experts from the Bankless podcast, including and , have discussed whether ETH can be considered money. Here are the key points from their discussions:

  1. Dual Nature: Ethereum is seen both as a productive asset and a monetary unit. It has characteristics such as store of value, medium of exchange, and unit of account within its ecosystem 1.

  2. Commodity Status: ETH has been referred to as commodity money, emphasizing its role as a tradable entity similar to physical commodities 2.

  3. Adoption and Utility: ETH is widely used as a medium of exchange and unit of account within the Ethereum network, particularly noticeable in the pricing of NFTs and other digital assets 3.

    Ethereum's Network Effects

    Raoul Pal and David Hoffman discuss the growing adoption of Ethereum and its network effects. They explore the perception of Ethereum as both a monetary unit and a technological platform, highlighting the recent interest in NFTs priced in ETH.
    Bankless
    80 - Ethereum is the Greatest Trade | Raoul Pal
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  4. Investment Perspective: From an investment perspective, ETH has been argued to fulfill the properties of money due to its divisibility, durability, transportability, and verifiability, akin to Bitcoin 4.

Overall, while ETH may not fit the traditional definition of money used universally, it functions effectively as a monetary unit within certain contexts, particularly the Ethereum ecosystem.

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