It’s hard to imagine one without money. Money is used daily to pay for goods and services, on both a small and large scale. From buying groceries and essentials to purchasing real estate and stock shares, money plays a key role in people’s lives.
While economic transactions have been around for millennia, money in its current form was not. The way currency, both fiat and digital, works today is a product of the evolution of money and the socioeconomic landscape.
The Evolution of Money
Around 3000 years before coins were first used, barter was a common practice for acquiring goods and services. This exchange heavily depended on negotiations and haggling between two parties. This resulted in some transactions taking weeks to fulfill due to the time needed to make the trade fair.
Thus, society began moving towards improving the speed and ease of trade. From settling on easily-traded commodities like animal skins, seasoning, and weapons, regions like China and Europe began creating objects such as coins to symbolize value for purchasing goods and services.
In the later years, financial institutions began to store and distribute metal coins. Paper currency was introduced soon after, allowing people to exchange them for their face value in metal coins. This enabled more large-scale buying and selling and additional security and convenience.
Nowadays, technology has enabled cashless payments, furthering their accessibility. It was only a matter of time before fully-digital currencies were developed. In 2009, Bitcoin was introduced as a digital currency operating with decentralized authority. This meant that banks or other financial institutions could not regulate it. Bitcoin relied on blockchain to secure and regulate transactions.
Get a better understanding of how money has evolved through the millennia and how digital currency will affect its future by reading the infographic below.
Infographic Source: https://coingeek.com/bitcoin101/what-is-money-its-evolution-over-the-years/