Money is a medium of exchange, such as coins and notes. In complex economies, money helps people to trade goods and services instead of making barters and reciprocal favours.

People have been recording the exchange of goods and services for more than 30,000 years. Yet, early hunter-gatherers had no money. Each group hunted, gathered, and manufactured almost everything they needed and, if necessary, made simple barters and reciprocal favours with each other.

Around 12,000 years ago, however, hunter-gatherers worldwide began to settle down to farm. Over thousands of years, they discovered that sowing seeds deep into the ground gave better results than scattering them on the surface. They learnt to pluck weeds, prevent parasites, and water and fertilize plantations to achieve better harvests.

Once people got good enough at farming, surplus came into being, and not all had to grow their own food. Some could start to practice skills they were good at and become, for example, artisans, soldiers, and priests. In the process, economies became ever more complex as people tried to exchange the goods and services they produced for the ones they needed. For instance, a cobbler looked for people willing to change food and clothes for a pair of shoes (or services of fixing shoes).

Perhaps being an exhausting task for many to find something both sides wanted with an equivalent value, ancient Sumerians in Mesopotamia began to use barley grains as a medium of exchange around 3000 BCE, pricing goods and services with a fixed amount of crops. The first known money came into being, making trading easier between people.

Like barley, early money typically had an intrinsic value, creating or increasing trust towards it. For example, grains were edible, beer drinkable, and furs wearable. Such items, however, were usually difficult to store and transport. Many were also perishables, staling over time, sometimes even filling the stomachs of hungry and thirsty humans. For that reason, within a few hundred years, people began to use silver and gold as money, futile metals too soft for useful tools.

Without intrinsic value, the value of money shifted solely into the human imagination. For successful trading, mutual trust that others would accept money as a method of payment became a prerequisite that rulers desired to nurture. Therefore, early counterfeiters were typically tortured before being killed, and still today, counterfeiting money remains a serious crime.

Over time, new types of money were developed. King Alyattes of Lydia struck the first coins around 630 BCE, and paper money emerged in China in the 11th century CE. In the modern era, internet banking, credit cards, smartphone payments, and digital currencies have become parts of our daily lives.

Today, less than ten per cent of all the money in the world is actual cash. The rest is digital money that exists only on computers.

Bibliography

Smithsonian. 2018. Inventions a Visual Encyclopedia. New York, United States: DK Publishing. 304 p. ISBN 9781465458384. Pages 68-69.

Harari, Y. N. 2015. Sapiens a Brief History of Humankind. London, United Kingdom: Vintage. 512 p. ISBN 9780099590088. Pages 192-204.

McWilliams, D. 2024. Money a Story of Humanity. London, United Kingdom: Simon & Schuster UK. 400 p. ISBN 9781471195433. Pages 15-43.

Potter, W. 2023. Homo Sapiens the History of Humanity And the Development of Civilization. London, United Kingdom: Arcturus Publishing Limited. 256 p. ISBN 9781788280914. Pages 96-97.

DK. 2022. Big History the Greatest Events of All Time from the Big Bang to Binary Code. London, United Kingdom: Penguin Random House. 375 p. ISBN 9780241515525. Page 291.

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