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Money and Its Future

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Nowadays the demand for paper money seems to decrease, yet will it totally disappear in the future? Money has a long history and it took various shapes, depending on the place and time it was issued. The oldest type of money is shell money which was used as a medium of exchange thousands of years ago. Some of those shapes are very unfamiliar nowadays. An example is money in the shape of small bronze knives or spades used in China 3000 years ago. The first coins appeared in China, India, and the Aegean region in the 7th century BC, while banknotes have been issued for over 300 years. Although the future of cash is uncertain, it is unlikely that it will disappear any time soon.

As I already mentioned, in the last decade, we have witnessed a constant decrease in the use of cash and a corresponding increase in digital transactions. The Pandemic has accelerated this process, by forcing people to stay inside and communicate via technology, but also due to the fact that cash money has a potential hygiene issue when handled.


The high demand for contactless payment, due to the Covid restrictions, has made companies that offer payment methods without cash (like PayPal or Apple) become very popular. Due to the health crisis, digital payment was no longer an alternative type of payment, it became a necessity. Many people are wondering whether Covid will put an end to the use of cash.

Is cryptocurrency the future of money? Bitcoin, the king of digital currencies, has been used for more than a decade now. Bitcoin's blockchain is used in a decentralized way so that no single person or group has control over it. This is increasingly a problem for central banks, which could lose control over the monetary supply if cryptocurrencies replace cash. Because of this decentralization, central banks oppose crypto but think about creating their own digital currencies. So far, banks in nine countries have introduced their own digital currencies. Those crypto competitors are controlled by banks and their value mirrors the value of the fiat money of the country. By comparison, crypto, such as Ethereum or Bitcoin, isn't dependent on any fiat currency. In July 2021, the European Central Bank said it is evaluating the possibility of introducing a digital Euro.


Money has changed shape throughout the ages from money in the shape of objects, coins and has then moved to more abstract forms such as bills of exchange, cheques, credit cards, and now we finally have the fully digital cryptocurrency. As you can see the trend was towards making money more abstract and moving away from a physical shape which points out to a future without cash.

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Considering the fact that humans themselves are becoming more "digital" because we are going to have brain chips implanted, we are likely to pay in the future, by simply using our brain (by a single thought).


The increasing demand for digital money raises a lot of questions about the future: will central banks and cash disappear, will digital money increase the risk of inflation, and the gap between rich and poor? Just like on the work market, where the development of digital technologies has started replacing humans with machines, thus leaving lots of people without jobs, this same development has started replacing the old fiat money with digital cash.

Although most signs indicate the future of money is a digital one, yet, for the near future cash is not likely to disappear for several reasons. Cash is easily accessible. For a company, it is very important to have immediate access to working capital. Some businesses prefer cash because they do not have to pay fees, as they would have to do if credit cards were used. There are specific groups of the population who will prefer cash, such as the elderly, the vulnerable, and those living in rural communities simply because it is easier to use.

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