Today, Anisha is here to tell us about the history of currency in Canada – from bartering to bitcoin. Where do you think currency is going next? Let us know in the comments!
Canadian currency has gone from being fur to being a unit that exists
partially online. To understand the shift we need to understand the history.
The Indigenous Peoples’ systems
Before European contact, Indigenous peoples in Canada had systems they relied on when trading and bartering goods. The Indigenous peoples traded goods such as copper, furs, and other resources. In particular, some eastern North American Indigenous peoples used belts called Wampum Belts as a medium for exchange. However, the Belt only became a currency after European contact; before then they were an important means of transmitting information and contracts. Shell-bead Wampum Belts were highly valued partly because of the hard-to-make shell beads. On average it took ninety days to make all the beads for one Wampum. Wampum quickly became a vital part of the fur trade as European settlers used them to trade for beaver pelts with people living inland. Wampum did not reign as currency very long after contact because it transitioned from a currency back to a ceremonial object by the early-nineteenth century. Today, some Indigenous peoples still use it in this manner. [Editor’s note: Wampum have a long and significant story of their own. If you’re interested in this topic, a good place to start is the Haudenosaunee Confederacy website.]
The rise of banks
In Canada, during the 1810’s more people started to trust banks because it became troublesome to carry large amounts of gold and silver. This resulted in a rapid rise of banks. Banks started to create their own currency out of gold and silver people had deposited into their vaults. One of the largest banks of that time was the Bank of Montréal (BMO); BMO imported its tokens from England and stamped most of them with their name. This, unfortunately, did not work well, because the lack of intricacy made the tokens easy to forge. To avoid more fraud three banks in Montréal and one in Quebec made a new version on the token. The improved token had an image of an habitant (early French settler) on one side and the Montréal coat of arms and the name of the bank on the other side. These tokens quickly became known as the Papineau. The coin was named after Louis Joseph Papineau because of his leadership role in the reformation of Lower Canada.
In the mid-1850’s Canada increased trade with the USA. At this time Canada chose to replace the sterling system that they had adapted from Britain in 1760 with the US decimal system. The colonies changed the system and issued new coins in 1, 5, 10, and 50 cent denominations. They made the transition in 1853-1857. After the adaptation it is important to acknowledge that US currency was also accepted in most parts of the colonies.
In 1867 several provinces in Canada formed the Dominion of Canada – an event known as Confederation. For the first time the government took it upon themselves to make a currency of their own. This started with Ottawa creating 1, 5, 10, 25, and 50 cent coins. These were all usable in Ontario, Quebec, New Brunswick and Nova Scotia under the Confederation Act. As Canada started to develop more it made the decision in 1868 to take US currency out of circulation, ensuring that only Canadian coins were used.
The First Coin
The first Canadian coin made its debut in 1908 at the opening ceremony of the Royal Mint in Ottawa. The first domestically produced coin in Canada was a silver 50 cent coin bearing an image of King Edward VII.
Since 1908 the look and the value of each coin has been continually changing. Now coins and bills are just one aspect of the way Canadians use money. In past years bills that have great worth have been taken out of circulation, for example the $1000 and $500 bills, because many opt to use their debit or credit cards instead. Today our money features a variety of security features that help prevent counterfeiting, and comes in different colours. Our coins are more creative now than ever and it is likely they will continue to evolve on that path.
Bitcoin was created in 2008 due to the need for a secure place to store money and execute payments. It was one of the first digital currencies but today there are over 900 forms of cryptocurrency. Now governments are banning this currency in their countries. Over the past 10 years Bitcoin has become the largest cryptocurrency and is worth well over 12,500 Canadian dollars as of January 30th, 2018. Many believe that Bitcoin is here to stay and say that governments are only rebelling against these cryptocurrencies
because not everyone deeply understands this concept. Recent advancements in this area suggest a bright future for the coin. Some think that Bitcoin will be successful because of its security. Cryptocurrencies such as Bitcoin are an extremely secure method of payment. One of the reasons it is so secure is because it is completely anonymous. It is extremely difficult to identify who is purchasing or selling the Bitcoin, and no personal information is ever released during any transaction. This idea of anonymity makes it almost impossible for hackers to trace back the money to anyone. Also, none of this
information is accessible by the government either. Bitcoin is a currency similar to our Canadian dollar except it is much more secure online. But despite all of this information, some people refuse to believe in Bitcoin.
Since Bitcoin and other cryptocurrencies are so secure and have the ability to be completely anonymous, Bitcoin has been used by criminals to hide money. This can be deemed unethical since its anonymity makes it harder to track down these criminals. Even if Bitcoin does not become as successful as some hope, online currencies are still our future. If it is not Bitcoin, something else similar to it will be created because new
advancements and evolution are inescapable.
If you told someone in the early 20th century that your money is kept on a plastic card it would have been thought impossible. So it only makes sense that our cards are going to evolve into something that exists in the online atmosphere.
For more on bitcoin, check out this video.