![]() Great Britain's early use of the silver standard is still reflected in the name of its currency, the pound sterling, which traces its origins to the early Middle Ages, when King Offa of Mercia introduced a 'sterling' coin made by physically dividing a pound (mass) of silver in 240 parts. During the heyday of the Athenian empire, the city's silver tetradrachm was the first coin to achieve "international standard" status in Mediterranean trade.įurther information: History of the English penny (c. The first metal used as a currency was silver, more than 4,000 years ago, when silver ingots were used in trade. Gold as the sole standard of value would not occur after various developments occurring in England starting the 18th century. Gold functioned as a medium for international trade and high-value transactions, but it generally fluctuated in price versus everyday silver money. Įveryday economic activities were therefore conducted with silver as the standard of value and with silver serving as medium of exchange for local, domestic and even regional trade. So even the smallest gold coin, the quarter-noble of 20d (with 1.7g fine gold), was of little use for domestic trade. In 14th to 15th century England, for instance, most highly paid skilled artisans earned 6d a day (six pence, or 5.4g silver in the mid-15th century), and a whole sheep cost 12d. įor millennia it was also silver, not gold, which was the real basis of the domestic economies: the foundation for most money-of-account systems, for payment of wages and salaries, and for most local retail trade. Sometime before 2500 BC the silver shekel became their standard currency, with tablets recording the price of timber, grains, salaries, slaves etc. 3300 BC the Sumerians recorded the use of silver as the standard of value c. However, the first commodity to satisfy all the functions of money was silver under the Sumerians of Mesopotamia as early as 3100 BC. 3300 BC, with bronze, silver and gold being the most prominent. The use of commodity money can be traced to the cultures of the Bronze Age c. By 1935 China and the rest of the world abandoned the silver and gold standards, respectively, in favour of government fiat currencies pegged to the pound sterling or the U.S. Imperial Germany’s move to the gold standard in 1873 triggered the same move to the rest of Europe and the world for the next 35 years, leaving only China (and, until 1930, the French Indochinese piastre) on the silver standard. Great Britain formalised the gold standard in 1821 and introduced it to its colonies afterwards. The move away from the silver to the gold standard began in the 18th century when Great Britain set the gold guinea’s price in silver higher than international prices on the recommendation of Sir Isaac Newton, attracting gold and putting them on a de facto gold standard. These silver dollar coins played the role of an international trading currency for nearly four hundred years. Following the discovery in the 16th century of large deposits of silver at the Cerro Rico in Potosí, Bolivia, an international silver standard came into existence in conjunction with the Spanish pieces of eight. ![]() Silver was far more widespread than gold as the monetary standard worldwide, from the Sumerians c. The silver standard is a monetary system in which the standard economic unit of account is a fixed weight of silver. Monetary system The Spanish silver dollar created a global silver standard from the 16th to 19th centuries.
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