Ages of money

The Five Ages of Money

1 Please copy and distributeVersion 1, Apr 7, 2023

We can identify four distinct ages in the history of money. Perhaps technological change is now pushing us into a fifth

CopenhagenFinance IT Region

The Fifth Element…


The Five Eras of Money

■ From 1.0 to, yes, 5.0

Money 5.0

■ What does it mean?

The Ages of Money


Money is a unit of account, a means of exchange, a store of value and a mechanism for deferred payment

Money—A Brief History


The First Age: Atoms


Eliminating the “double coincidence of wants”

■ Money increases the efficiency of trade

Lots of things can be money

■ Lumps of stone

■ Iron tools

■ Copper ingots

Some things work better than others

■ Gold, silver and a few other things

Some Atoms

Standardisation supported trade and growth


The Second Age: Atoms about Atoms


Moving things around is a hassle

■ Collective memory

■ Grain stores

■ Goldsmiths

Move the claim, not the land

■ The invention of central banking

Some Atoms about Atoms

Monetising the stores of value


Third Age: Bits about Atoms


One of the first uses of the telegraph

■ The first electronic funds transfers

■ Money faster than a horse or a train

Telegraph traffic peaked in 1929

■ Telegrams ended in 2007

■ But Western Union is still around

People were transferring £, $, Dm, ¥…

■ But they were all backed with gold and silver

Some Bits about Atoms

Ideas born in this era still shape our thinking


Fourth Age: Bits about Bits


The rise of the fiat currency

All money is e-money

■ Well, almost (97.3% in the UK)

■ That e-money is a “promise to pay”

The means of exchange is evolving

■ We all know it’s going mobile

■ Remote control for “wallet in the cloud”

Moving away from fiat currencies?

■ Kivas

■ Goldmoney

Some Bits about Bits

It will be the mobile phone that ends cash


A Fifth Age? Bits


Money is about to change again

■ It may become truly virtual, bits and nothing more

What kinds of bits?

■ World of Warcraft gold pieces?

■ Facebook credits?

■ Reputations?

Bitcoin

■ Digital mining

Some Bits

Zynga had revenues of $850m last year


Where Next?


Maybe using notes and coins will be like drinking and driving – it will still go on, but nice people won’t do it

Just One Example

Winner of the “smart banknote” design 2011


Thank You


Any (More) Questions?

Tomorrow’s Transactions:thought leadership from Consult Hyperion

Read www.chyp.com/media/blogListen www.chyp.com/media/podcastsVisit www.chyp.comContact [email protected] @chyppings

Contact Details


Dave BirchDirectorConsult Hyperion

[email protected] @dgwbirch

http://www.chyp.com/media/blog

http://www.chyp.com/media/podcasts

http://www.chyp.com/

mailto:[email protected]

Ages of money

Documents