Then comes what is called the coin. Metal was chosen as a medium of exchange because it has a high value so that the rage, durable and not easily broken, easily broken down without reducing the value, and easily movable. Metal is used as a medium of exchange because it met these conditions are gold and silver. Gold and silver coins also known as money management (full-bodied money). This means that the intrinsic value (the value of materials) of money equal to its nominal value (the value specified on the currency). At that moment, everyone is entitled to forge money, merge, sell or use, and have unlimited rights in the coin store.
Along with economic development, difficulties arise when the development of the exchange that must be served with a coin increases while the amount of precious metals (gold and silver) are very limited. The use of coins are also difficult to transactions that were created in large quantities of paper money
First banknotes in circulation is evidence of ownership of gold and silver as a tool / broker to make transactions. In other words, banknotes in circulation at that time the money is guaranteed 100% by gold or silver stored in smart gold or silver and can be redeemed at any time with a full guarantee. In further developments, the public no longer use gold (directly) as a means of exchange. Instead, they make the 'paper-proof' as a medium of exchange.
