The value of money through time_BKMM

Central Bank Digital Currencies

Digital Money and Cryptocurrencies

Fiat Money

Abandonment of the Gold Standard

The Gold Standard

Fiduciary Money and Paper Currency

Standardized Coins

First Coins Appear

through time

The value of money

Barter System

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Zelmanovitz, L. (2015). La Teoría del Valor del Dinero y la Evolución Monetaria para Simmel y Mises. Laissez-Faire, 42, 37-53. Helleiner, E. (2003). The making of national money: Territorial currencies in historical perspective. Cornell University Press. https://youtu.be/O7Ui5LmhCFA?si=h9Y7IAiGNNRY4wMM

Origin: Since 1971, most of the world’s economies have adopted fiat money, meaning money that has no intrinsic value and is backed by public trust.Value: The value of money is determined by monetary policies, inflation, supply and demand, and trust in the country’s economic stability.

Fiat Money (1971 – Present)

Origin: In China, during the Tang Dynasty (7th century), paper money was introduced. Paper money became more widespread in Europe during the 17th century.Value: Based on the trust in the authority (government or bank) that issued the currency, as it had no intrinsic value.

Fiduciary Money and Paper Currency (7th Century – 18th Century)

Origin: By the 19th century, many economies adopted the gold standard, where money was backed by a specific amount of gold.Value: The value of money was directly tied to the value of gold, providing stability but limiting governments' ability to print money.

The Gold Standard (19th Century – 1944)

Origin: After World War II, the Bretton Woods system established the U.S. dollar as the world's reserve currency, backed by gold. In 1971, the U.S. abandoned the gold standard.Value: The value of money was no longer backed by gold, and instead, it depended on trust in the issuing country's economy.

Abandonment of the Gold Standard (1944 – 1971)

Origin: The first standardized coins were minted in the Kingdom of Lydia (modern-day Turkey).Value: Coins had a fixed value based on the weight of the metal they contained, facilitating trade.

Standardized Coins (600 BCE – 476 CE)

Origin: With the creation of Bitcoin in 2009, cryptocurrencies gained popularity as a new form of decentralized digital money.Value: Cryptocurrency values fluctuate dramatically, relying on user confidence, underlying technology (blockchain), and global supply and demand.

Digital Money and Cryptocurrencies (2009 – Present)

Origin: Early human societies relied on barter to exchange goods and services.Value: The value was entirely based on the demand and supply of goods being exchanged.

Barter System (10,000 BCE – 3,000 BCE)

Origin: Many governments are investigating or developing official digital currencies issued by central banks (CBDCs).Value: These digital currencies would be controlled by central banks but would be in digital form, aimed at modernizing payment systems.

Central Bank Digital Currencies (2020s – Future)

Origin: The first known coins emerged in ancient Mesopotamia and Anatolia. Precious metals like gold and silver were used as money.Value: Value was tied to the intrinsic worth of the precious metals.

First Coins Appear (3,000 BCE – 600 BCE)