Theory of Constraints and Bitcoin: Introducing a New Fulcrum

Abstract

Much of the attention on bitcoin relates to its ability to store value over time or whether you will one day by able to buy a cup of coffee with it. Much less attention is given to bitcoin’s potential role as a unit of account. This opinion piece proposes that bitcoin has potential to provide a consistent unit of account for organisations to adopt, but also to assist them in making and measuring meaningful business developments. The paper draws from the business improvement philosophy of Theory of Constraints to propose that unit of account, particularly within high inflation environments, is critical to consider. An illustrative case of a well-known publicly traded company, Microstrategy, provides an example and logic for a company choosing to integrate bitcoin into a business. The paper also gives attention to how the adoption of bitcoin can promote the development of renewable energy infrastructure and provide staff with opportunities for personal development to support their well-being. Opportunities for further research are identified to explore the integration of bitcoin within a business as well as with Theory of Constraints.