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A short history of the coins as currencies

A short history of the coins as currencies

Apr 6, 2018

At first, the metal is cut into pieces and weighed and determined to measure its value. Because it is inconvenient, gradually the kings or local rulers begin to forge money. Over time the metal pieces are given a certain shape (usually a piece). On the piece, it is labeled as a heavy guarantee and measure or image (king, “the sovereign”) and a number that indicates its value. Nowadays, coins are more to aesthetical things such as collections and custom challenge coins.

The number on the chip is called the nominal value and the value of the material or chip is called the intrinsic value. The currency of gold has a high value. In fact, to meet the needs of daily use of small change or small money.

The problem arises again, how to hold the small money. To overcome this problem, currency is made lower than precious metals or other metals, namely silver and bronze.

Given the coinage of gold, silver or bronze, there are more than one currency in circulation, with a ratio of values according to their intrinsic value.

Currency in the circulation of more than one currency in a country is troublesome. For that purpose, it needs to be disciplined, and determined one official currency called the base currency or standard money.

Because of the change in the price of silver in the market, a difference or difference exists between the nominal value of the currency and its intrinsic value. Thus, the comparison of values ??between the silver currency and the gold currency (default) becomes chaotic.

On the basis of the situation as mentioned above, people begin to realize that there can be no two kinds of precious coin in common in a country with a fixed value ratio.

Chances are two kinds of coins at once with the condition that one of the two kinds of money is given a (nominal) value by the government and set apart from the value of the material.

So, there is only one kind of precious metal that is used as a standard money of full value, while the other currency is not worth full. Money whose nominal value is greater than its intrinsic value is called the sign money.