I remember learning about bartering in some elementary school, but it didn’t occur to me to ask until now. How the heck does a society collectively agree that “mm yes these metal circles equate to cows”? Does the government just give everyone 100 shmeckles and let supply and demand cover the rest?
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After 2000 years or so the kings of Lydia came up with coins as a way of paying mercenaries, who were outside the general credit system. They caught on as a way of state display, and also making money for states. Some currencies had a better reputation for purity and standard weight, so were widely used as the reference point in trade – the Aegetinian and later the Athenian stater, in medieval times the Florentine shilling or the Venetian zecchino. States asserted a sole right to issue coins, but anyone could issue notes, and there were lots of private banks that did (and do). States only mandate the standard of value – the dollar, euro or rouble or whatever. Most currency is still notes of debt and credit.
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