> Every bill has a serial number, so every bill is unique. This is what it means when money is "marked" in a police investigation, they give bills with known serial numbers to bad actors in a criminal enterprise and then recover the bills at the other end of the enterprise proving the connection.
This has nothing to do with fungibility unless a bill’s serial number affects either your ownership of the bill or whether the bill will be accepted as payment.
Fungibility is related to being indistinguishable for the purpose of economic transactions, not being physically indistinguishable.
Being fungible does not imply that something does not have a serial number or identification number. For example US dollar bills are fungible but they have serial numbers.
I see you are repeating something patently wrong and even adding some equally wrong "spice" to it, like that cash notes are non fungible by design, which is somehow "literally an inseparable part of their physical existence". This despite currency (in any form) predating the formalized concept of fungibility.
Money is fungible by every (literal) definition of the word, whether banknotes or coins. Being fungible doesn't refer to the physical aspect of being absolutely identical but to its value. Money exists to be fungible, fungibility is literally one of the big things that make money work. Going even further, money is probably one of the few things equally fungible whether new or used, and sometimes even old/outdated (think retired currency which can be converted to currency in circulation).
Whether coins or banknotes, they are interchangeable from one to another regardless of serial or the year stamped on them. And almost any other two new "identical" products are just as fungible: two loaves of bread, two planks of wood, two pencils, or two cars (not the case for used products). They're all mass produces, quasi-identical units.
And the serial numbers? They're used mainly for uniquely tracing the note and don't affect the fungibility in any way. The proof? Randomly pick a banknote every time you pay for something. If it works every time either you're the luckiest person in the world, or they're completely fungible.
That's more or less like saying dollars aren't fungible because you can check the serial number on a bill to see if it matches one that was reported stolen.
Cash is kind of fungible, but not really. Every bill has a serial number, so every bill is unique. This is what it means when money is "marked" in a police investigation, they give bills with known serial numbers to bad actors in a criminal enterprise and then recover the bills at the other end of the enterprise proving the connection.
In common practice it's fungible in the sense that one twenty dollar bill is as good as another. In edge cases though it's not quite fully fungible.
Dollars have serial numbers does that mean they're not fungible? Does the author know what fungible means? Banks block transactions all the time to/from flagged sources.
I specifically took the example of a (physical) $10 bill. You can definitely tell apart two different $10 bills. They have serial numbers, for example. They're different physical objects.
They're exactly as fungible as a dollar is. A dollar with a unique serial code except every person who's had possession of this dollar has logged that serial number into a publicly visible log, even if they don't put their name next to the entry. But you can spend it like any other history tracked serialized dollar.
Fungibility has nothing to do with dollar bills and everything to do with dollars. You can't make a withdrawal from a bank after two years and ask for the same dollar bills back that you deposited.
If 10% of $20 bills (by serial number) were not considered legal tender, then $20 bills would no longer be fungible.
The ramifications are the important part. If 10% of bills are essentially fake money, you have to verify every bill you handle, adding significant friction.
The same can be true of dollar bills. A bag full of dollar bills from a drug deal is fungible with a bag full of dollars from your salary. But you can be arrested for the former, and not the latter.
Dollars are fungible with dollars ($1+$1=2$), NFTs are not fungible with NFTs (1NFT+1NFT=1NFT+1NFT).
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