By David Fox, Professor of Common Law, University of Edinburgh
In 2018 the Governor of the Bank of England, Mark Carney, pronounced that cryptocurrencies were “failing” as money. Their extreme volatility against state-issued fiat currencies, like sterling or the US dollar, proved they were inefficient stores of monetary value. Storing value through time is one of the main functions of money.
Mr Carney’s comments raise important questions for lawyers. Does the law have a distinctive conception of monetary value, and is there any difference in how it might apply to a privately-created cryptocurrency compared with a state-issued fiat currency?