Before the bitcoins (Part I of II)
A brief history of digital currency: from barter to DigiCash.
In the beginning there was the transaction.
From the day the first Homo sapiens (Homo neanderthalensis?) gave up their flint tools in exchange for pieces of amber owned by their neighbour sapiens, the exchange process began. Since then, we’ve never looked back. What happened on that distant day tens or hundreds of thousands of years ago was a transaction, both in its definition as an agreement between two parties as well as a commercial operation.
The first system we used was barter: the direct exchange of objects for other objects; services in exchange for objects or other services. This system was simple and came naturally, ideal in small communities which only had a few goods to exchange.
One of the limits of this exchange operation is that the needs of the two bartering parties had to coincide; if Isolde wants to exchange her spun fabric for one of Tristan’s amphoras, the prerequisite would be for Tristan to need that fabric. But if Tristan requires medicine instead, Isolde will then have to look for someone who has that medicine and will give it to her in exchange for her fabric.
