What is Money? The Journey from Coins to BitCoins

Money as we know it today did not always exist. How many of us today carry wads of cash in our wallet? To think I haven’t gotten even started on coins–something that most of us living in modern societies consider a ‘heavy’ nuisance. Plastic cards and app-based electronic modes of payment are the modus operandi of money in the world that we netizens currently inhabit.

Back in the day–there is no need to think too far back here; my present lifetime is close enough–my great-grandfather assigned me the task of counting coins. This was the 90s and I was in kindergarten. It was the first time I was exposed to the concept of money. The Singapore dollar, which is presently the thirteenth-most traded currency in the world, sprang into existence in 1967. Go on then, do a mental calculation… Actually, hang on a second, you’re welcome to use your app… Yes, indeed… the Singapore dollar, which is one of the strongest valued currencies in the Asia-Pacific, is only 53 years old.

The Coin

Government-issued coins first sprang into existence in 7th century BC in Lydia, modern-day Turkey. Whilst the genesis story of the origin of coins remains a disputed topic amongst historians, we can be certain of three things. Firstly, money did not always exist. Secondly, it is a human invention. And thirdly, humans do not–and did not–actually need it to survive.

The human brain’s ability and capacity to imagine the unimaginable, bring it into existence and then to create systems and ‘measurable facts’ around these ideas is a source of endless fascination for me.

Many of us think that cashless, moneyless societies only exist in hunter-gatherer societies. History, however, tells a different story. Even before the invention of coinage; the ancient Egyptians, Aztecs and Babylonians (amongst others) had successfully developed complex civilisations with architecture, religion, art and even science–without any need for money!

Oh the shock that went through my system when I discovered this!

There is a common adage that I’ve heard repeated over and over again. Time is money. When we accept an hourly wage for our work, we are exchanging time for money. The fact of the matter is, humans were not always paid for work. In The History of Money, Jack Weatherford states that it is money that commodified human labour according to “its importance, the amount of skill or strength it required and the time it took. As money became the standard value for work, it was also becoming the standard value for time itself.”

So if time isn’t money–then what is?

Money is Currency

We typically think of money as a tangible resource, but it is a metaphor. A powerful and pervasive metaphor that gives us the ability to structure our lives in a way that was not available to us before the invention of money. Money created the marketplace. A marketplace for the exchange of goods and services with a common denominator. It is this common denominator that allows us to cross the boundaries of nature, culture and creed and speak a common language.

Money is that language. In a way, it is the lingua franca of the modern world.

The English word ‘currency’ comes from the Latin currens, -entis which literally means “running” or “traversing”. This concept is rooted in the notion of “state or fact of flowing from person to person”. The very first coins minted in Lydia, was mankind’s first step towards representing this ‘flow’ that went from one individual to another. Fast-forward to the 21st century, and this ‘flow’ can move between individual and corporation; and even corporation to corporation.

If we look at it from the lens of human history, the entire concept is mind-boggling and yet to most of us–it is the norm.

The Future

The human metaphor of ‘money’ has continued to change course since the 7th century BCE. We have made the long journey from coins… to BitCoins; from physical currency to digital currency. Launched in 2009, Bitcoin is the world’s largest cryptocurrency by market cap. The word crypto means ‘hidden’ and has its roots in the Greek kruptos. There are no physical bitcoins; only balances kept on a public ledger that is verified by a massive amount of computing power.

Even in my short life span of three decades, we have come a long way from the tangible coins that I once stacked according to denomination in my childhood. I no longer carry or count coins, let alone keep them in my wallet. I am often stunned when I see a sign that says ‘CASH ONLY’ in big letters, no less. And every time I do, I scramble around like a millennial on an app looking for the nearest ATM.

Which leads me to wonder–what exactly is money? What role does it play in modern life and what role will it play in our future?

About the Author

Dipa Sanatani is the Publisher at Mith Books and the author of The Little Light and The Merchant of Stories. In The Merchant of Stories, Dipa takes the reader on a personal journey–narrated through a series of candid journal entries–on what it takes for entrepreneurs and creatives to start their very first venture.