Breaking down currency prejudice || Historical development of money || Future world for crypto wallet
Hellow hivers!
Today I will discuss the historical development and diversification of money..
Money is any damn short of things that is used as the medium of exchange. It is one of the most primitive inventions of human being.
Unusual Money: Barter System
At the very early ages of human being, people like to exchange real products rather then any medium of exchanges that was called Barter System. This is like to exchange a cow with a horse. That's time every real product itself was money.
There are some major limitations of this system. Most of the products cannot be divided into a small segment. That's why sometimes it could happen injustice in transactions. How you will measure the actual price and utility of a product that had no standards?
Sometimes it was impossible to transact different goods. For example, you have a cow. You need a horse and some rice. But no one had both horse and rice. So you have to buy only horse or only rice altering with the cow. Due to the limitations of barter system, then people invented money.
Initiation of Money
Primarily, there was no government in the societies rather than a small group of people. The group of people imposed value upon different things that was accepted as money on that group of people. Such as one group of people may except leaf, another group of people may accept oyster, or other accept stones.
There are also some great problems. One major problem is, you could not exchange with that money beyond your territory. Because when territory changed, the medium of exchange also changed. So you have to use it only at your own area.
Another big problem is, there was no control on money supply. So if you accept a stone or a specific life as a medium of exchange, it may be owned by anyone at any amount. So it could not confirm real monomial utility perfectly.
Metal coin
After the development of social system, people felt that they should have in accepted medium of exchange. Then coin was invented. Main characteristics of metal coin was it's own value. There were some differences of metal coins in different territories. Some area accepted gold, some accepted silver, bronze.. etc.
Thar system overcomed some major problems of resistance, but still then it had limitations. There was no common medium of exchange all over the world. That's why, one people wanted to exchange with other area, they faced some difficulties.
The value was also relative, such as silver may be precious in one area but maybe cheap in another area. Coin types was also changed due to change in geographical location and time.
Gold standard: Golden step
Day by day the social system and economics activities rises, as well as the financial transactions also increased. So people initiated gold standard.
Gold was the most accepted medium of exchange that had agreed own utility. Any country used gold all over the world. It was a great initiative for the financial world.
Era of Nominal Money
After that, the countries felt the necessity to initiate nominal money. Something which doesn't have the actual value but the authorities imposed some value upon it by the government announcement.
Nominal money created a lot of opportunities on economic sector. Countries developed their own currencies which are now looking as the world recognised medium of exchanges, as US dollar, Euro etc.
WB & IMF: Rises of two giant
To control the supply of money, Central Bank was established in everywhere. Central Bank reserved gold on its vault to keep value of money. It was the stage, when money got its original figure of currency that is called paper money.
To exchange from one country to another that is called international trade, required some common currency. After the second world war-II, the Britten Wood Conference solved these problems by establishing World Bank and IMF.
They are working about the international trade and synchronising the monetary policies among all countries all over the world.
Alternative Money System
At the second half of the last century, people realised some limitations of paper money. Paper money is not sustainable. It may tear or become fade. There was a lot of security system, but it was going to be created by some financial criminals. General people could not identify fake notes, even bankers do. Another major problem is unhygienity. Many germs spread through the cash transactions.
Carring of paper money is a boring job, it has some risk to be hijacked. So for the solution, the popularity of alternative money system increasing day by day. Most famous three formats of alternative money are:
- Plastic money
- Virtual money
- Crypto Currency
Why people turn to alternative currency system?
Alternative currency system like plastic money, cryptocurrency etc eliminated previous problems and barriers of monetary system that I mentioned above. It is very much easy to transact and the security system is also very nice. Still now it is under development, but people are accepting it sharply for its unique feature.
Some countries still now cannot understand that the future world will be dominated by cryptocurrency. Some countries have imposed some restrictions on cryptocurrency.
So far they would remove the barriers from crypto wallet, that would be healthy and beneficial for their economy.
About Me:
I am Tariqul Islam Like Blog, Vlog, Writing, Photography & Art Hive: @tariqul.bibm 3speak: tariqul.bibm FB : Tariq Bin Mutalib
I am an Engineer by Graduation,
Teacher by occupation & Writer by passion.
I believe, Life is beautiful!
