A REVIEW OF CRYPTO CURRENCY AS CASH AND CASH EQUIVALENT
Florence N. Belonwu, PhD
Volume 7 Issue 1
Abstract
In the year 2008, electronic coin was introduced into the world of business. Thereafter Bitcoin was formally launched in 2009 after which various altcoins were mined. Crypto currency (CC) was introduced to provide an alternative medium of exchange used for investment purposes, to simplify online purchases and to eliminate the middle man (banks or financial institution) and third party transactions (interest on transfer). The aim of this review is to highlight the place of CC as to whether it is cash or cash equivalent. In IAS 7 cash was described as “cash on hand and demand deposit†and in other studies it was described as anything that is generally accepted for payment of goods and services (whether physically or electronically managed). Some of the functions and characteristics of the conventional money were also used to examine CC, to verify if it has the same characteristics as the conventional money. When one considers the aforementioned characteristics, then CC cannot be viewed as cash or cash equivalent because it is not generally accepted; and it is not backed by any standard nor is it convertible to short term investments at a future date.
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