Money is not a metal, but a registered trust. No matter whether silver or clay is used as currency, paper money, or virtual currency that appears on the LCD, there is no big problem. From shells in the Maldives to boulders in the Pacific Yap Island, everything can serve as currency. It now appears that in this electronic age, there is nothing that cannot act as currency.

—— Neil Ferguson, historian, “The Rise of Money: How Finance Affects World History”


“Ascent of Money: How the financial impact of world history”, author: Neil Ferguson, Translator: Crosby, CITIC Publishing House published in July 2012 .

The historical evolution of traditional economic textbooks on currency is often summarized as: physical currency (such as ordinary commodities such as cattle, sheep, shells)-metal currency (Precious metals such as gold, silver and copper)-credit currency. Among them, the first two types of currencies are commodity currencies (commodity theory of money) described by classical economists and neoclassical economists. Traditional economic theory usually defines currency in terms of its function. Currency is considered to have four major functions: the medium of exchange, the scale of value, the means of payment, and the means of value storage. However, the nature of money is rarely mentioned. This article believes that the essence of currency is the debt relationship between the two sectors. In simple terms, currency is debt . In the modern banking system, the deposits on the liability side of commercial banks are currency, which is essentially reflected in the debt relationship between the banking sector and the private sector. This article sorts out the evolution of money from a historical perspective and believes that the essence of money has never changed, and money has always been debt . From this perspective, commodity currency is only a carrier of currency, which never reflects the essence of currency.


First stage: no trade economy

In a self-sufficient economy, everyone consumes only the products he produces, and no trade occurs. Such as