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1 What is Money?

From: The Legal Concept of Money

Simon Gleeson

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2022. All Rights Reserved.date: 09 December 2022

Currency and the unit of account — Concept of money — Functions and status of money

This chapter details how money is usually regarded as having three characteristics—a unit of account, a medium of exchange, and a store of value—and this can be described as the traditional rule of recognition for money-ness. However, it is important to note that not all things that have all three of these characteristics are money. Firstly, the status of unit of account is a purely theoretical construct—a coin may be created to represent the unit of account, but it is the unit of account which defines the coin and not vice versa. Secondly, money may be useless as a store of value whilst retaining its characteristics as both a unit of account and a medium of exchange. Finally, money need not exist to be money; a unit which does not exist cannot easily function as a medium of exchange.

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