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w w w . C A N A D I A N L a w y e r m a g . c o m J u n e 2 0 1 4 31 [are] inconsistent with the laws in other jurisdictions." The Bank of Canada, too, provided a revealing peek of its take on virtual cur- rencies. Money serves three functions: it's a generally accepted medium of exchange; it serves as a unit of account to help consum- ers compare the value of different goods like the cost of a Tim Hortons coffee with a Starbucks one; and it can be used as a store of value. "We would argue that bit- coin and other cryptocurrencies fall short of a definition of money and do not satisfy the functions of money, at least at pres- ent," said Grahame Johnson, chief of funds management and banking at the Bank of Canada. "First, for bitcoin to be a currency, it would need to be generally accepted and it would need to be a medium of exchange. While there may be some potential, it's not quite there yet." Thanks to its volatility, it also falls short of being able to be considered as a store of value, added Johnson. A recent report esti- mates the volatility of the value of bitcoin is about 108 per cent per year or about 40 times greater than the volatility of the real value of a U.S. dollar. In more vivid terms, a bitcoin traded at a third of a cent per bitcoin in 2010. Last December it reached a high of US$1,200 before diving to $430 in early April. "The volatility of bitcoin means that customers who store value in bitcoin are exposing themselves to a lot of variability and a great deal of risk in terms of what the savings could be worth, even in a relatively short period of time, like a week," said Johnson. That's why there are some who would describe cryptocurren- cies such as bitcoins as speculative invest- ments. Others like the Bank of England and the Bank of Finland suggest bitcoin is more similar to a commodity than a currency. That does not detract from the value of cryptocurrencies. Even if bitcoins or similar cryptocurrencies ultimately fail, Johnson believes other payment innova- tions will rise to replace them. Jean-Pierre Lam, a University of Waterloo profes- sor and former economist at the Bank of Canada, agrees. "It's about the technol- ogy, and not about bitcoins itself. It is the technology that is going to grow. It's in its infancy. That's where we will see this thing take off," says Lam. The underlying technology behind bit- coins may quite possibly have a notable impact on the legal profession, predicts Hoegner. Future iterations of cryptocur- rency will likely have the possibility to embed instructions or algorithms in a block chain or some kind of distributed ledger that allows for some functions of a contract. Another possibility may be that one or more block chains could be used to create and administer arbitral proceedings and establish intellectual property rights. "We're only really now starting to scratch the surface of what that can mean, and what that means for lawyers and what it means for consumers," says Hoegner. Order # 986332-65203 $234 Hardcover approx. 1000 pages May 2014 978-0-7798-6332-7 Shipping and handling are extra. Price(s) subject to change without notice and subject to applicable taxes. 00219TA-A43901 Gain a sharp, clear explanation of the principles underlying significant developments in the field with Principles of Administrative Law, 6th Edition. First published in 1985, this seminal work has been cited with approval by every level of court in the country and is considered to be the field's leading text. Get a concise treatment of all important topics, including constitutional considerations, the concept of a statutory delegate, the acquisition of jurisdiction, procedural fairness, discretionary powers, standards of review, and public and private law remedies against governmental action. New in this edition The authors examine the important recent developments in administrative law, including the implications of the Supreme Court of Canada decision in Dunsmuir. All chapters have been updated and Chapter 16 (Private Law Remedies and the Tort Liability of Public Authorities) has been completely rewritten. The classic work cited with approval by all levels of court New Edition Principles of Administrative Law, 6th Edition David Phillip Jones, Q.C. and Anne S. de Villars, Q.C. Available risk-free for 30 days Order online: www.carswell.com Call Toll-Free: 1-800-387-5164 In Toronto: 416-609-3800

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