Recently, I delved into a fascinating book called “Debt: The First 5000 Years” by anthropologist David Graeber. The book provides an intriguing exploration into the origins and evolution of money, debt, and their significance in the structure of societies. This exploration offers a fresh perspective that deviates significantly from traditional economic thought.

Where standard views depict a society that inefficiently exchanged goods and services via barter, which then led to the birth of money, Graeber’s research suggests something different. According to him, primitive societies primarily shared resources among each other, leading a communal lifestyle. Bartering was a rare occurrence, mainly employed when different communities interacted. It had no bearing on the internal transactions of early societies.

The concept of money, particularly commodity money, only gained traction during infrequent interactions between communities across vast distances. Local economies didn’t adapt such exchange mechanisms; instead, they relied on credit. This credit system, monitored and governed by authorities like those in Ancient Sumer, evolved from the informal credits people contemplated when sharing resources in primitive societies. But it was formalized and sustained by the governing power and temples of Sumer. Transactions didn’t involve the exchange of money; people merely documented debts at the temple and occasionally fulfilled their obligations with consumable goods.

Debt preceded coinage, created and sustained on a large scale by the state. Commodity money surfaced later, minted and circulated by the government, following the collapse of extensive trust-based civilizations, which gave way to warring imperial states. In times of perpetual warfare and marauding armies, debt and credit lost their relevance with no assurance of returning to settle debts.

Throughout history, societies have consistently alternated between virtual credit money and coinage, depending on the prevailing climate of war and conquest. This pattern has repeated itself over the ages, with people establishing their localized credit networks after the fall of vast empires that used coinage. The government gradually intervened in these networks as mediators, leading to the resurgence of coinage as violent empires rose again.

Contrary to conventional teaching, barter never played a role in the evolution of money. Moreover, the state invariably had a direct involvement in the development of monetary systems and markets.

Graeber’s arguments, grounded in historical and anthropological evidence, are compelling. He offers a strong case for Chartalism, which might be a challenging notion for many.

From my perspective, this revelation makes Bitcoin even more significant. Bitcoin isn’t merely a return to stateless money – considering Graeber’s findings, such a concept never truly existed. Bitcoin represents the first-ever stateless money, making it a profoundly monumental achievement and historical shift.

Regardless of your economic perspective, I highly recommend “Debt: The First 5000 Years”. It offers valuable insights, especially in the context of Bitcoin.

This article represents my personal viewpoint and may not necessarily align with the sentiments of BTC Inc or Bitcoin Magazine.