They say that money makes the world go round. But how does it work, and how has it changed over time? While developing the ECO Coin, we’ve been thinking a great deal of money, past and present. From the origins of civilization up to present day, economy has gone through countless shakeups, and yet we tend to take our current way of thinking about money for granted. Welcome to the second part of The Story of Money: Shells.

We left off last week with the ascendance of livestock as currency. For a while, this standard seemed to suit everyone well enough. But as the centuries went on, other currencies were developed. Where livestock had an immediate practical value, providing meat and dairy products for consumption, other currencies were not quite the same. This is where money begins to take on symbolic dimensions.

Cowry shells, of all the currencies in history, have been the most widespread and used for the longest time. First used as money in China during the Shang dynasty, these shells had a long and broad history, being used at different times in India, Africa and Europe. Unlike livestock, they were valued not for their practical uses but primarily for their uniqueness and beauty.

These shells, colorful and appealing, were often not simply kept stashed away but openly displayed as jewelry – which conveniently made them much easier to carry. Better still, there was no way to effectively forge them. The ancient societies which valued cowry shells often considered the sea to be the source of all life, and the cowries to be a bounty provided by this life-source. Currency had moved out of the realm of barter, and into a world of collective imagination.

An example which takes this tendency to the extreme is the rai stone, used as currency on the Micronesian island Yap. Not only do these huge wheel-shaped carved stones not have a practical use, they are also far too large to be practically transported. Instead, the Yapese keep an oral history of each stone owner, and the value of the stone was determined partially by its historical heft. In one instance, a rai stone even sank to the sea floor, but remained in the economic system of the island. Islanders would simply agree to transfer ownership of the stone without ever having to see it for themselves.

Money from the cowry shells onwards was not merely practical any more, but decorative, social and symbolically rich. Suddenly, the public imagination governed value.

Next week: Paper

Previous episode: Livestock


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