As we talk about upgrading the world to a better financial system, it’s also important to consider the forces that currently control our money, and the pros and cons of the current system. So we’re taking you on a tour of the Evolution of Money: where it comes from, why we use it, the forces that dictate its behaviour, and what it all means for you.
In this story, we’re looking at currency: the money systems used around the world as a medium of exchange.
In the UK, all banknotes include a little statement that’s a good starting point for this exploration of the history of currency: “I promise to pay the bearer on demand the sum of twenty pounds.” Even if you’ve never held a British banknote, that statement is still relevant to the money you use on a day to day basis.
So, what does it mean? When you think about it, that doesn’t make much sense. When you pay for something with a banknote, aren’t you paying the seller that amount of money, rather than giving them a sort of IOU note?
To understand what that statement means and how it connects to Bitcoin, we need to look at the history of currency.