Money is generally defined as anything of value, or anything that can be used as a medium of exchange. Money has been around for thousands of years, although it has come in many shapes and sizes. What we consider money today--coins, currency and credit cards--is just a small piece of the monetary timeline.
The Beginning: Bartering
Prior to civilizations, humans were nomadic people who traveled in small groups and were self-sustaining--they grew, ate and built everything they needed without outside assistance. Around 10,000 B.C., these nomadic groups began building more permanent settlements and grew crops and livestock to sustain their growing community. The people within these communities relied heavily on each others' skills and eventually on the goods and services neighboring communities offered. Bartering became the first form of currency. Cattle, sheep, grain and other crops would be exchanged with one another and/or other communities for other goods needed at the time.
Money Takes Shape
The earliest known form of money was shells, which were believed to be used as early as 1,200 B.C. This primitive form of money was found on nearly every continent, although it was extensively used throughout the Pacific and Indian Ocean islands and communities. Shells were often polished or shaped, and strung together like beads--the more shells, the more value. In addition, certain shells would carry higher values than others, which created one of the first denominational monetary systems. Shells continued to be used as money well into the 1800's. Wampum, one of the most popular shell currencies, was used by the Native Americans around 1500 A.D.
The Introduction Of Coins & Metals
The first coins to be used as money originated in China around 900 B.C. Bronze and copper were used to create imitation shells and lacked inscriptions or other markings found on modern coinage. It was not until approximately 600 B.C. in Greece that modern coinage would surface. Using metals like copper, bronze, silver and gold, the Greeks created a new denominational monetary system wherein the value of each coin came from its metal content, with gold being worth the most. Each coin featured a design and/or inscription to help validate authenticity and was an early form of regulation and counterfeit prevention.
Paper Currency
China once again found itself at the forefront of the monetary revolution. Around 800 A.D., the first known currency was produced, although these were more "letters of credit" than true currency. Several hundred years later, banknotes--paper money backed by banks--began to be used, although it was not until the early 1800's that they were backed by gold or other precious metals.
Money Today
Over the last 200 years, money has not changed very much. We continue to use coins and currency, although the size, denominations and production techniques of these items has changed. In the United States, coins and currency can no longer be exchanged for their value equivalent in silver or gold. Modern technology enables us to churn out billions of coins and bills each year, unlike the hand-made coins of the past. Technology has also led to the increase of electronic money, such as credit cards and electronic funds transfers, which has reduced (but not eliminated) the need for cash. What the future holds is unknown, but one thing's for sure--there will always be a need for money.
