The History of Money – 5 Great facts
Money is anything that’s acceptable by a set of people and is meant for the exchange of services, goods or resources. Every country has its own currency and a history behind it, most countries now are still using paper and coins while few have now introduce digital money known as e-money. However all the countries have their history trend for their currency and this trend is common among many countries. Here are some five great facts about the history of money.
Commodity and barter trade money
Barter is the exchange of goods and services with another good or service. Barter trade is the oldest form of trade and it was rather difficult to agree on the real value of a commodity. This problem made humans being come up with another way of carrying out their trade; it marked the introduction of commodity money. Commodity was actually some basic items like tea, salt, tobacco, seeds and cattle that everybody at one time needed. These products were thus used as a form of money, however these commodities developed other issues, the need to carry them, it was observed that some of these commodities were perishable or at one point they were cumbersome to carry and use. This led us to the development of another form of currency, the coin.
Metal were first used as money at 700 B.C. they were preferred because they were lighter than commodity money and they were also readily available and would be recycled besides being easy to work with. Coins had values inscribed on them thus were easy to work with.
Paper money came into existence at around 960 AD, they were first used in china and other countries began to adopt them onwards. Paper money was preferred as it was lighter and one would actually go with lots of cash with no one knowing it.
After the paper currency, representative money set in. This implied that what money was actually made of no longer needed to very valuable. Representative money was endorsed by governments and banks which promised to give silver or gold in exchange of the real value of money. Most countries in the twentieth and nineteenth century actually used representative money. (Image by nesnet)
Fiat is actually a Latin word which means let it be done. Fiat money replaced representative money. Money is these days given value by the acting government; this marked the begging of money being referred to as a legal tender. Refusal to accept the legal tender or using any other form of money is considered illegal. (Image by Steve Byrne)
The future of money is actually today, people are no longer using coins or paper lately. Money has been digitized, electronic money or digital cash is what’s being used to transact businesses over the internet. This has reduced the globe to almost a village; you can buy or pay for anything and it will be delivered to your doorstep. Advancement in technology will continue to bring in new and other better forms of currency.
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