Currency

A Currency is a economic instrument that serves as a medium of exchange, store of value, and unit of account within an economic system.

• AKA: Money, Legal Tender, Medium of Exchange.
• Context:
  • It can typically facilitate Economic Transactions between currency users.
  • It can typically represent economic value in standardized units.
  • It can typically store purchasing power across time periods.
  • It can typically receive government backing through currency regulations.
  • It can typically enable price discovery for goods and services.
  • It can typically circulate within currency boundaries defined by political entities.
  • It can often exhibit currency stability based on currency trusts.
  • It can often require currency management by central banks or monetary authorities.
  • It can often influence international trade through currency exchange rates.
  • It can often develop currency network effects within economic communities.
  • It can range from being a Physical Currency to being a Digital Currency, depending on its currency form.
  • It can range from being a Fiat Currency to being a Resource-backed Currency, depending on its currency backing mechanism.
  • It can range from being a National Currency to being a Supranational Currency, depending on its currency issuing authority scope.
  • It can range from being a Stable Currency to being a Volatile Currency, depending on its currency market dynamics.
  • It can serve as a monetary policy tool for economic management.
  • It can function as an inflation hedge during economic uncertainty.
  • It can participate in currency baskets for international reserves.
  • It can undergo currency revaluation or currency devaluation due to economic conditions.
  • It can experience currency substitution during hyperinflation periods.
  • It can represent national sovereignty through currency symbolism.
  • ...
• Examples:
  • Currency Forms, such as:
    • Physical Currencys, such as:
      • Coin Currencys, such as:
        • Ancient Greek Coin Currency demonstrating early standardized currency units.
        • Modern Coin Currency facilitating small-value transactions.
      • Paper Currencys, such as:
        • Banknote Currency enabling portable value storage.
        • Treasury Note Currency representing government debt obligations.
    • Digital Currencys, such as:
      • Central Bank Digital Currency providing government-backed digital currency.
      • Cryptocurrency Currency utilizing cryptographic security mechanisms.
      • Commercial Bank Money Currency representing digital bank deposits.
  • Currency Backing Types, such as:
    • Fiat Currencys, such as:
      • US Dollar Currency (post-1971) maintaining currency value through government trust.
      • Euro Currency serving as a supranational currency for European economic integration.
      • Japanese Yen Currency functioning as an international reserve currency.
    • Resource-backed Currencys, such as:
      • Gold Standard Currency linking currency value to gold reserves.
      • Silver Standard Currency basing currency value on silver reserves.
      • Commodity-backed Currency deriving currency stability from physical commodity.
  • Currency Scopes, such as:
    • National Currencys, such as:
      • British Pound Currency serving as the official currency of the United Kingdom.
      • Chinese Yuan Currency supporting the economy of the world's most populous nation.
    • Regional Currencys, such as:
      • CFA Franc Currency facilitating economic cooperation across West African nations.
      • Eastern Caribbean Dollar Currency serving multiple Caribbean island nations.
    • International Currencys, such as:
      • Reserve Currency functioning as global value storage.
      • Vehicle Currency dominating international trade settlements.
  • Historical Currencys, such as:
    • Ancient Currencys, such as:
      • Lydian Electrum Coin Currency (7th century BCE) pioneering standardized currency production.
      • Roman Denarius Currency supporting the economic infrastructure of the Roman Empire.
    • Medieval Currencys, such as:
      • Byzantine Solidus Currency maintaining currency stability for over 700 years.
      • Tang Dynasty Currency facilitating Silk Road trade.
    • Pre-Modern Currencys, such as:
      • Spanish Dollar Currency (Pieces of Eight) serving as an early global currency.
      • Maria Theresa Thaler Currency demonstrating trade currency longevity.
  • ...
• Counter-Examples:
  • Financial asset, which lacks universal acceptance as a medium of exchange.
  • Barter system, which lacks standardized unit of account.
  • Store of value asset, which lacks currency circulation function.
  • Virtual game token, which lacks legal tender status in real-world economy.
  • Gift card, which lacks general acceptance beyond specific merchants.
• See: Currency Measure, Currency System, Monetary Policy, Foreign Exchange Market, Currency Crisis, Currency War, Currency Invention, Inflation, Central Banking, Currency Union, Currency Conversion.

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References

2019

• (Wikipedia, 2019) ⇒ https://en.wikipedia.org/wiki/Currency#History Retrieved:2019-1-9.
  • Originally money was a form of receipt, representing grain stored in temple granaries in Sumer in ancient Mesopotamia and later in Ancient Egypt.

    In this first stage of currency, metals were used as symbols to represent value stored in the form of commodities. This formed the basis of trade in the Fertile Crescent for over 1500 years. However, the collapse of the Near Eastern trading system pointed to a flaw: in an era where there was no place that was safe to store value, the value of a circulating medium could only be as sound as the forces that defended that store. Trade could only reach as far as the credibility of that military. By the late Bronze Age, however, a series of treaties had established safe passage for merchants around the Eastern Mediterranean, spreading from Minoan Crete and Mycenae in the northwest to Elam and Bahrain in the southeast. It is not known what was used as a currency for these exchanges, but it is thought that ox-hide shaped ingots of copper, produced in Cyprus, may have functioned as a currency.

    It is thought that the increase in piracy and raiding associated with the Bronze Age collapse, possibly produced by the Peoples of the Sea, brought the trading system of oxhide ingots to an end. It was only with the recovery of Phoenician trade in the 10th and 9th centuries BC that saw a return to prosperity, and the appearance of real coinage, possibly first in Anatolia with Croesus of Lydia and subsequently with the Greeks and Persians. In Africa, many forms of value store have been used, including beads, ingots, ivory, various forms of weapons, livestock, the manilla currency, and ochre and other earth oxides. The manilla rings of West Africa were one of the currencies used from the 15th century onwards to sell slaves. African currency is still notable for its variety, and in many places various forms of barter still apply.

2014

• (Wikipedia, 2014) ⇒ http://en.wikipedia.org/wiki/currency Retrieved:2014-2-11.
  • A currency (from "in circulation") in the most specific use of the word refers to money in any form when in actual use or circulation, as a medium of exchange, especially circulating paper money. This use is synonymous with banknotes, or (sometimes) with banknotes plus coins, meaning the physical tokens used for money by a government. A much more general use of the word currency is anything that is used in any circumstances, as a medium of exchange. In this use, "currency" is a synonym for the concept of money. A definition of intermediate generality is that a currency is a system of money (monetary units) in common use, especially in a nation. Under this definition, British pounds, U.S. dollars, and European euros are different types of currency, or currencies. Currencies in this definition need not be physical objects, but as stores of value are subject to trading between nations in foreign exchange markets, which determine the relative values of the different currencies. Currencies in the sense used by foreign exchange markets, are defined by governments, and each type has limited boundaries of acceptance.

    The former definitions of the term "currency" are discussed in their respective synonymous articles banknote, coin, and money. The latter definition, pertaining to the currency systems of nations, is the topic of this article.

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