Unfortunately, the Bitcoin success story has been tied intrinsically with instability, with excitement and envy for those who have become rich through investing in it — rich for a while at least, because the value of the electronic currency has fluctuated wildly. The instability of Bitcoin’s value in dollars is a measure of failure, not success. It means that any commerce using Bitcoin or its competitors would be buffeted by enormous inflation and deflation.

But if we go back to the electronic-money drawing board, we may conclude that Bitcoin has been focused on the wrong classical functions of money, as a medium of exchange and a store of value. Bitcoin offers a way of “mining” electronic coins that can replace our dollar bills and bank accounts. Yet there is no fundamental need for this. Money, as we’ve known it for decades, works quite well in these respects. It would be much better to focus on another classical function: money as a unit of account — that is, as a basic standard of economic measurement. Scientists spend a lot of time thinking about ways to improve systems of measurement. Business people should, too.

This has already begun to happen. History shows that this unit-of-account function of money has been separated from the other two, and to good purpose. For example, since 1967 in Chile, an inflation-indexed unit of account called the unidad de fomento (U.F.), meaning unit of development, has been widely used. Financial exchanges are made in pesos, according to a U.F.-peso rate posted on the website valoruf.cl. One multiplies the U.F. price by the exchange rate to arrive at the amount owed today in pesos. In this way, it is natural and easy to set inflation-indexed prices, and Chile is much more effectively inflation-indexed than other countries are.

Consider rents. Increases may seem unfair to tenants, yet they may be needed to offset inflation. In Chile, a landlord can easily set the monthly rent for the tenant in U.F.s and then never have to change it, reducing the potential for errors, delays and misunderstandings. The name “U.F.” reframes people’s thinking so that keeping real economic values stable is natural and easy.

With electronic software in the background, we can improve on the Chilean idea and make it more useful. First, we should use more evocative words and avoid jargon. I’d suggest calling the unit of account a “basket.” A basket is a simple description for something rather complicated. In its basic form, it is the equivalent of one day’s common consumption items, like the local marketbasket of typical purchases that already underlies the Consumer Price Index. The value from one base year would be chosen so that, with inflation, the price of a basket in local currency terms would rise.