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History of Money

From barter to bitcoin, all about the history of money.
History of Money

Money is a tool we use to supply our needs. It makes our lives easier, faster and enables us to access more.

Barter System

Before the emergence of money, people exchanged excess goods for other products to supply their needs. In this period when there was no money, the barter activities that occurred among people created trade. In order for the barter to take place, it was necessary to have someone with the desired product and be willing to replace it with something else. For example, A person who had extra apples in his hand and wanted to buy fabric had to find someone who had extra fabric in his hand and wanted to replace it with apples. This was not always something that could easily be achieved. For this reason, people would travel for a long time and perform many swaps until they got what they wanted.

Emergence of Money

Lydian Gold

Due to the difficulties of the barter, the clam shells, wood, salt and metals, which are considered to be money, were used as exchange tools. Each of these goods had a value accepted by everyone, among all these products, precious metals were the most suitable materials to be money. Gold and silver were mostly used as money. Precious metals are rare in nature, as well as easy to form. In addition, metal coins could be divided into smaller pieces. In this way, it was possible to pay exactly at the product price, not more or less than the price of the product. However, traders had to weigh their metal pieces to make or receive payments. To avoid this situation, it was decided to make metal parts of predetermined weight into coins. Thus coins were born. The Lydians became the first Western culture to make coins.

Value of Money

With the widespread use of coins, states took over the task of printing money, and over time, printing money has become a symbol of domination. For this reason, all states that declared their independence printed money first. These moneys, printed by the states, carried the picture of those who ruled the state or the seal of the monarch. This part of one side of the money indicates and guarantees the value of money. With this guarantee, money would be accepted by everyone.

Invention of Paper Money

Coins were costly because they were made of precious metals such as gold and silver. It was also difficult to move coins. For this reason, paper money has emerged that is less costly and that people can carry and use more comfortably.

The first paper money was printed in China in the 9th century BC and its usage spread to this region in a short time. Paper money came to Europe in the 13th century thanks to Marco Polo's journey to China. Marco Polo saw that paper coins made from mulberry tree bark were used in China. The emperor's stamp was imprinted on the coins to prove that these coins were valid for payments.

Cryptocurrencies

Humanity invented such a thing in the 21st century, perhaps the greatest invention in history. The reason is that it brings a different interpretation to the money. A cryptocurrency called "Bitcoin" invented by a person or group called Satoshi Nakamoto. What makes Bitcoin so special is that it is decentralized and protected against tertiary interventions. Bitcoin has created a new market environment. Currently, there are nearly 3000 cryptocurrencies in the world.

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