According to Doug Casey, the five essential attributes of good currency, based on Aristotle's writings, are that the money has to be durable, divisible, convenient, consistent, and have value in itself. Casey covers these attributes with respect to bitcoins in detail. However, let's look at a competitor to bitcoins which no one ever thinks of.
Did you know that you can buy just about anything on Amazon (AMZN)? And when I say just about anything, I mean just about anything, without going into specifics. Obviously, you can't buy cars or guns (unless you are buying a tattoo gun, and ear piercing gun, a pellet gun, or a toy gun). But this world's largest retailer, which started out as an online bookseller, can offer you everything from cellphones to makeup to clothing to food to coffeemakers to watches (does anyone still wear those?) to jewelry to guitars to baseballs to gift cards, either electronic or physical. If you receive an Amazon gift card, you log in to your Amazon account, type in the card code, and your card is credited.
These funds, which Amazon refers to as Gift Card Balance and I'll refer to as Amazon dollars, are good forever. You can spend these on whatever you want (assuming Amazon sells it) whenever you want. Plus, the data for these Amazon dollars are stored on very secure servers. The company recently won a huge contract to provide computing services and data storage to the CIA. Although IBM is challenging the decision, it does show that if the CIA is willing to trust Amazon, it must provide very secure services. So Amazon $s certainly qualify as durable.
How small a purchase can you make? One cent, so this currency is certainly divisible.
Are Amazon $s convenient? Sure, just go to your account and use them. You don't need to pull out your credit card and type in your credit card number. You don't need to send a check in. As a matter of fact, you don't need a checking account or even a credit card to be able to use Amazon dollars. You can go to almost any supermarket, pay cash for a gift card, then type in the code to your account.
Each Amazon dollar is identical to any other, so they are certainly consistent.
Have value in itself
Does the Amazon dollar have value in and of itself? Yes, each one is worth exactly one US dollar, no more no less. Of course, if the value of the dollar drops, the value of the Amazon $ drops, but at least it won't drop below the value of a dollar.
Although privacy isn't part of Aristotle's Five Characteristics, I thought I would mention it in relation to the Amazon dollars. One drawback to the Amazon $s is that you can't just transfer your Amazon $s to another person (currently) or even buy a gift card with your Amazon dollars. But what you can do is walk into a supermarket, pay cash for a gift card and mail it to the person you want to transfer the money to. (Or you can email the gift code to the person.) So transferability can be a challenge but is still possible.
Don't get me wrong about bitcoins; I like the concept and I even own some bitcoins. The point I'm trying to get across is that I see a lot of similarities between bitcoins and Amazon dollars, and that Amazon.com gift card balances can even be considered a kind of currency.
Disclosure: Author didn't own AMZN at the time the article was written.