Banknote in the context of Redemption value

Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are: medium of exchange, a unit of account, a store of value and sometimes, a standard of deferred payment.

Money was historically an emergent market phenomenon that possessed intrinsic value as a commodity; nearly all contemporary money systems are based on unbacked fiat money without use value. Its value is consequently derived by social convention, having been declared by a government or regulatory entity to be legal tender; that is, it must be accepted as a form of payment within the boundaries of the country, for "all debts, public and private", in the case of the United States dollar.

A currency is a standardization of money in any form, in use or circulation as a medium of exchange, for example banknotes, coins,electronic balances in bank accounts, and central bank digital currencies (CBDCs).A more general definition is that a currency is a system of money in common use within a specific environment over time, especially for people in a nation state. Under this definition, the Pound sterling (£), euro (€), Japanese yen (¥), and U.S. dollars (US$) are examples of (government-issued) fiat currencies. Currencies may act as stores of value and be traded between nations in foreign exchange markets, which determine the relative values of the different currencies. Currencies in this sense are either chosen by users or decreed by governments, and each type has limited boundaries of acceptance; i.e., legal tender laws may require a particular unit of account for payments to government agencies.

Other definitions of the term currency appear in the respective synonymous articles: banknote, coin, and money. This article uses the definition which focuses on the currency systems of countries (fiat currencies).

The Monetary Convention of 23 December 1865 was a unified system of coinage that provided a degree of monetary integration among several European countries, initially Belgium, France, Italy and Switzerland, at a time when the circulation of banknotes in these countries remained relatively marginal. In early 1866, it started being referred to in the British press as the Latin Monetary Union, with intent to make clear that the United Kingdom would not join, and has been generally referred to under that name (French: union latine) and the acronym LMU since then. A number of countries minted coins according to the LMU standard even though they did not formally join the LMU.

The LMU has been viewed as a forerunner of late-20th-century European monetary union but cannot be directly compared with it, not least since the LMU did not rely on any common institutions. Unlike the Scandinavian Monetary Union established a few years later, the Latin Monetary Union remained limited to coinage and never extended to paper money. That made the LMU increasingly less relevant, and it was quietly disbanded in 1926.

A social construct is any category or thing that is made real by convention or collective agreement. Socially constructed realities are contrasted with natural kinds, which exist independently of human behavior or beliefs.

Simple examples of social constructs are the meaning of words, the value of paper money, and the rules of economic systems. Other examples, such as race, were formerly considered controversial but are now accepted by the consensus of scientists to be socially constructed rather than naturally determined. Still other possible examples, such as less empirical and more abstract concepts which underlie particular scientific theories, remain the subject of ongoing philosophical debate.

A currency is a standardization of money in any form, in use or circulation as a medium of exchange, for example banknotes, coins, electronic balances in bank accounts, and central bank digital currencies (CBDCs). A more general definition is that a currency is a system of money in common use within a specific environment over time, especially for people in a nation state.

Paper money, often referred to as a note or a bill (North American English), is a type of negotiable promissory note that is payable to the bearer on demand, making it a form of currency. The main types of paper money are government notes, which are directly issued by political authorities, and banknotes issued by banks, namely banks of issue including central banks. In some cases, paper money may be issued by other entities than governments or banks, for example merchants in pre-modern China and Japan. "Banknote" is often used synonymously for paper money, not least by collectors, but in a narrow sense banknotes are only the subset of paper money that is issued by banks.

Paper money is often, but not always, legal tender, meaning that courts of law are required to recognize them as satisfactory payment of money debts.

Intaglio (/ɪnˈtæli.oʊ, -ˈtɑːli-/ in-TAL-ee-oh, -⁠TAH-lee-; Italian: [inˈtaʎʎo]) is the group of printing and printmaking techniques in which an image is incised into a surface and the incised line or sunken area holds the ink. It is the direct opposite of a relief print where the parts of the matrix that make the image stand above the main surface.

Normally copper, or in recent times zinc, sheets called plates are used as a surface or matrix, and the incisions are created by etching, engraving, drypoint, aquatint or mezzotint, often in combination. Collagraphs may also be printed as intaglio plates.

Steel engraving is a technique for printing illustrations on paper using steel printing plates instead of copper, the harder metal allowing a much longer print run before the image quality deteriorates. It has been rarely used in artistic printmaking, although it was much used for reproductions in the 19th century. Steel "engraving", in fact technically mostly using etching, was introduced in 1792 by Jacob Perkins (1766–1849), an American inventor, for banknote printing. When Perkins moved to London in 1818, the technique was adapted in 1820 by Charles Warren and especially by Charles Heath (1785–1848) for Thomas Campbell's Pleasures of Hope, which contained the first published plates engraved on steel. The new technique only partially replaced the other commercial line engraving techniques of that time such as wood engraving, copper engraving and later lithography.

Foreign exchange reserves (also called forex reserves or FX reserves) are cash and other reserve assets such as gold and silver held by a central bank or other monetary authority that are primarily available to balance payments of the country, influence the foreign exchange rate of its currency, and to maintain confidence in financial markets. Reserves are held in one or more reserve currencies, nowadays mostly the United States dollar and to a lesser extent the euro.

Foreign exchange reserves assets can comprise banknotes, bank deposits, and government securities of the reserve currency, such as bonds and treasury bills. Some countries hold a part of their reserves in gold, and special drawing rights are also considered reserve assets. Often, for convenience, the cash or securities are retained by the central bank of the reserve or other currency and the "holdings" of the foreign country are tagged or otherwise identified as belonging to the other country without them actually leaving the vault of that central bank. From time to time they may be physically moved to the home or another country.

Cash is money in the physical form of currency, such as banknotes and coins.

In book-keeping and financial accounting, cash is current assets comprising currency or currency equivalents that can be accessed immediately or near-immediately (as in the case of money market accounts). Cash is seen either as a reserve for payments, in case of a structural or incidental negative cash flow, or as a way to avoid a downturn on financial markets.

Banknotes of the euro, the common currency of the eurozone (euro area members), have been in circulation since the first series (also called ES1) was issued in 2002. They are issued by the national central banks of the Eurosystem or the European Central Bank. The euro was established in 1999, but "for the first three years it was an invisible currency, used for accounting purposes only, e.g. in electronic payments". In 2002, notes and coins began to circulate. The euro rapidly took over from the former national currencies and slowly expanded around the European Union.

Denominations of the notes range from €5 to €500 and, unlike euro coins, the design is identical across the whole of the eurozone, although they are issued and printed in various member states. The euro banknotes are pure cotton fibre, which improves their durability as well as giving the banknotes a distinctive feel. They have a variety of color schemes and measure from 120 by 62 millimetres (4.7 in × 2.4 in) to 160 by 82 millimetres (6.3 in × 3.2 in) (first series) and from 120 by 62 millimetres (4.7 in × 2.4 in) to 153 by 77 millimetres (6.0 in × 3.0 in) (second series). The euro notes contain many complex security features such as watermarks, invisible ink characteristics, holograms, optically variable inks and microprinting that document their authenticity. While euro coins have a national side indicating the country of issue (although not necessarily of minting), euro notes lack this. Instead, this information is shown by the first character of each note's serial number.

A bank of issue, also referred to as a note-issuing bank or issuing authority, is a financial institution that issues banknotes.

The short-lived Stockholms Banco (1657–1667) printed notes from 1661 onwards and is generally viewed as the first-ever bank of issue. Banks of issue are thus a more recent creation than transfer or giro banks, which create money in accounts on a ledger, the oldest recorded being the Taula de canvi de Barcelona established in 1401.

A government note is a form of paper money which is directly issued by a government, as opposed to banknotes which (in a strict sense) are issued by a bank which is known for that reason as a bank of issue. Government notes predate banknotes in history, but are mostly a concept of the past. In the 21st century so far, nearly all paper money has taken the form of banknotes issued by a national (or in some cases such as the euro, supranational) central bank.

In macroeconomics, money supply (or money stock) refers to the total volume of money held by the public at a particular point in time. There are several ways to define "money", but standard measures usually include currency in circulation (i.e. physical cash) and demand deposits (depositors' easily accessed assets on the books of financial institutions). Money supply data is recorded and published, usually by the national statistical agency or the central bank of the country. Empirical money supply measures are usually named M1, M2, M3, etc., according to how wide a definition of money they embrace. The precise definitions vary from country to country, in part depending on national financial institutional traditions.

Even for narrow aggregates like M1, by far the largest part of the money supply consists of deposits in commercial banks, whereas currency (banknotes and coins) issued by central banks only makes up a small part of the total money supply in modern economies. The public's demand for currency and bank deposits and commercial banks' supply of loans are consequently important determinants of money supply changes. As these decisions are influenced by central banks' monetary policy, not least their setting of interest rates, the money supply is ultimately determined by complex interactions between non-banks, commercial banks and central banks.

From 1775 to 1779, the Continental Congress issued Continental currency banknotes. Then there was a period when the United States just used gold and silver, rather than paper currency. In 1812, the US began issuing Treasury Notes, although the motivation behind their issuance was funding federal expenditures rather than the provision of a circulating medium. In 1861, the US began issuing Demand Notes, which were the first paper money issued by the United States whose main purpose was to circulate. And since 1914, the US has issued Federal Reserve Notes.

Since 1971, Federal Reserves Notes have been the only banknotes of the United States dollar that have been issued. But at some points in the past, the United States had multiple different types of banknotes, such as United States Notes (1862–1971), Interest bearing notes (1863-1865), and Gold certificates (1865–1934).