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Money Evolution: From Barter to Bitcoins

Money Evolution: From Barter to Bitcoins

Money has become a part of our society for around 5,000 years. That isn’t a short time and money has transformed itself from versions to versions. While people bartered the things they had for the things they wanted in the past, everything is significantly different now: people are to trading in cryptocurrencies, especially bitcoins. Let’s take a look at the Money Evolution.

The Birth and the Growing-up process

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Barter was the trade between things and things when the society was moneyless

Long long ago, people did not have the perception of “money”. They just realized that there was a time when things they wanted belonged to others and others wanted their things. So they came up with an idea of exchanging things for what they wanted. This is the basic form of barter. But very soon, people, again, realized that there was an imbalance in the value of things they traded.

For example, they learnt that they couldn’t trade a beautiful jar for an apple that later they realized it was rotten. Then they came home turning and tossing about this problem. And the society kept striving, people got more civilized, and they wanted a more stable and fair way of trading. Many cultures around the world came up with creating a new type of money that had the same value as the material that made it. This was the “specie money”.

At the beginning, the coin money was made by copper and later iron. Because they realized that iron possessed a greater amount and it was much stronger to endure a lifetime. The monetary value depended on the metal that people used to created the coins. Coins were very convenient because instead of weighing, people would count the coins. People trusted this new form of money (though they might not have known the term “money” at that time). The advent of coins pushed the economy of many societies to a new level. It boosted not only the economy but also the standard of life of the people in the communities.

But out of the disadvantages come the creativity

The very first type of coins appeared in the community of Mesopotamia. People called it the siglos or the shekel. The Shekel was, in face, an ancient form of money. Later, people gradually agreed the importance of this new form of money. It even appeared in the Hammurabi’s law code around 1,700 BC. The society in Mesopotamia developed an economy with large scale depending much on the commodity money. The Babylonians and many regions nearby later developed a new system of economy that was fundamental to our economic system today. It revolved around the rules on debt, contracts, law codes of business and personal property, etc.

Around 700 BC, King of Greek Pheidon of Argos was the first to set the firm standard for the weigh of the money and generally the money itself. Instead of using iron to make money, Pheidon of Argos decided to coin the money with silver. King Pheidon first made the silver coins in Aegina in the temple of the wisdom and war goddess, Athena Aphaia. Later he had the coin decorated with the turtle on the surface of it. Turtle currencies were used and accepted internationally until the war of the Peloponnesian. After the war broke out, Athenian drachma took over the popularity.

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The Turtle money
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Athenian drachma

The first ruler that used the gold coins was the King of Macedonia, King Phillip II.

Money Evolution: From metal to paper

But very soon, people once again realized the weak points of coins. They could be worn out if they were transferred too many times. That was not to mention the fact the the source to create coins wasn’t limitless. With the great creativity, people came up with a new idea to get away with the coins.

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Chinese was the first to issue the paper money

The very first region to create and use paper money or banknotes was China. It was the Song dynasty between 600 and 1455. These banknotes were the Jiaozi. And they had been used ever since the 7th century. In Europe, the first bank to issue the paper money was Stockholms Banco a Sweden Bank in 1661. However, the bank used the banknotes along with the coins. At this time, banknote wasn’t common so the bank quickly ceased issuing the banknotes because they kept running out of the coins to pay for the notes. And it wasn’t until the 1690s when the Massachusetts Bay Colony printed paper money and the money has been in the reign ever since.¬†Around the beginning of the 20th century, nearly all countries around the world adopted the new system of paper money.

The latest form of money by far has fallen for the cryptocurrencies. This is the form of digital money that uses the encryption to protect the transaction and to control the creation of new amount of money. The first cryptocurrency is bitcoin and there have been many new forms of it. Whether the future money depends on the cryptocurrencies or not remains a mystery. If the money evolution will reach a new level or not remains to be seen.

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Bitcoin is a form of digital money

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