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Zhi Finance » What is the definition of currency?

What is the definition of currency?

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According to the explanation of economic theory, any commodity that can perform the functions of a medium of exchange, a measure of value, a standard of deferred payment, and a fully liquid means of storing wealth can be regarded as money.

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The predecessor of money was an ordinary commodity, and it gradually evolved into a general equivalent in the process of exchange. Money is a commodity, but it is not an ordinary commodity, but a special commodity. After the emergence of money, the entire commodity world was divided into two poles, one pole was a special commodity – money, and the other pole was all ordinary commodities.

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The history of people using money originated in the era of barter. In primitive society, people used barter to exchange the materials they needed. Sometimes, limited by the types of materials used for exchange, people have to find an item that can be accepted by both parties to the exchange, and this item has the function of money.

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After a long period of natural elimination, the items used as money were gradually replaced by metals. With the further development of the economy, paper money, the symbol of metal currency, also appeared.

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Since money is the general representative of value and social wealth, whoever possesses money is equivalent to possessing value and wealth. Therefore, its power is not as sharp as a sword, but its effect is more lasting.

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