The money that does not exist: Cryptocurrencies and renewable energies

It is well known that money is what makes the world go round. However, when we want to define the concept of money, we realise that it is more complicated than it seems. It may be precious metals, papers with a certain written value or an abstraction of the non-existent that is kept somewhere in the bank or, in recent years, in the information network distributed throughout the world.

Barter was the first form of payment in the world. It consisted of the exchange of two material goods between two people: the buyer and the seller. For example, a farmer who had beef or lamb could go to the city in search of tools, offering his meat as payment. In this way, a hammer could cost two kilos of beef or one kilo of lamb. There was no set price for the products. In addition, the person selling the hammer might not need the meat, so the purchase of the tools would be very difficult.

Due to these problems, the use of precious metals as a means of payment in shops was chosen. It could be in the form of powder, nuggets, pieces, blocks, among others. One of the problems was that the value was measured by weight, so it was a complicated task to measure at every moment or break the metal into the desired parts. In addition, counterfeits were easy to make, since there was no regulation on the specifications that the metal had to have. The materials used were gold, silver and copper, so the extraction activity of these was important at this time. In addition, the need to transport the powder or pieces of metal was very uncomfortable. It had to be carried in bags or containers that could be easily lost or stolen. With all its problems, the form of payment seemed to be the correct one, although not the most efficient, but the money could be saved and preserved without losing its value. Because of this, the process of minting coins began.

Initially, transactions were not organized or written down to keep a record. This is how money lending became an indispensable mechanism for development, especially in agriculture, where payments could be guaranteed by the future harvest. In addition, there was no record of loans and interest calculations, so anyone could say they were owed 100 gold coins and no one could deny or affirm it. The first records of this type date back to the time of the culture of Mesopotamia, a place between the Tigris and Euphrates rivers, present-day Iraq and Syria. This is how mathematics, writing and a set of laws that regulate economic relations (the Hammurabi code) emerged. Transactions between people began to be recorded for the control and proper management of resources.

Coins now circulated in the streets and were carried from shop to shop; these small pieces of metal had a distinctive design on their surface to indicate their value and prevent counterfeiting. But, as is customary in the history of money, there was a problem: the weight of the coins. When there were a lot of coins, there was a need for a lot of space to store them and a lot of means of transport to get them from one place to another. As a result, the use of so-called banknotes began, which included unique distinctive designs to prevent counterfeiting. In this way, there was an economic system that worked in every corner of the world.

Recommended citation: I. Jesán Velázquez-Reséndiz and Yuri G. Rubo, ACMor (2022, September 05)
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