Paper currency has come a long way in existence. The image below was one of the first bank note invented in China, during the Tang Dynasty (618-907).
But the paper money didn’t exist until the 11th century. The first paper banknote was obviously invented in China. It is a form of deposit from a merchant during the Tang Dynasty.
To avoid the super heavy of the copper during transitions to the merchants and the wholesales. Metal coins were made up of gold, silver, copper, and many other metals. They were used mainly for trading for goods globally. However, they would be incredibly heavy when you had too many of them.
Therefore, many merchants started leaving their bulky coins in a place they can trust to keep it for them, in exchange, the merchants will receive a piece of paper showing the deposit they owned
By the 1120s, the central government started printing their own paper money by using woodblock printing (using 6 colors of inks). Jiazi, the exact paper banknote was finally developed in the 11th century under the Song Dynasty’s power. Since the lack of copper to produce coins. However, the Jiazi didn’t officially replace the coins but are still in use.
Paper banknotes existed in Europe much later than in Asia. Apparently, because European countries didn’t obtain the paper, The production of paper was stopped due to the prejudice of the Christian religion.
Because the paper in Europe was made up by heather moors, This led to the ban of documents that were written on paper by the Holy Roman Emperor Frederick II in 1221.
On February 3, 1690, the first paper money was authorized in Western. It was called credit
Even though Britain was trying to suppress other colonies to issue their own currency.
Basically, the expenses for paying military bills were covered by this credit which just is a temporary way to cover the lack of money by saying “pay later”. In 1775, the Continental Congress issued the first American national paper money known as Continental currency or Continentals.
Its denomination from $1/6 to $80 in dollars.
Paper money now is threatened by another new innovation "digital currency".
But in the past, the value of paper money became a symbol, It marked the new invention in human history.
It replaced the super classical type of currency, coins. It paved out a new path for humans can be more creative to have a better life afterward.