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Currency

In the context of community currencies (CC), currency does not refer to the different forms of money used as legal tender in different countries – foreign currencies – but to a much wider field of units that fulfill all or some functions of money or even express and facilitate forms of exchange that are not catered for by money as we know it.

In the narrow and often ambiguous use of the term by economist and banks, currency often refers to the tangible forms of money, e.g notes and coins. 1

There are two perspectives on the distinction of money and currency: one, mostly presented by CC practitioners and advocates being that money (as we know it) is just one type of currency and CCs are demonstrating how else it could be designed, the second perspective, more fungible with orthodox economics, is that currency is a tradable form of money, leaving the definition of the latter open.

Encyclopaedia Britannica describes currency as follows: “in industrialized nations, portion of the national money supply, consisting of bank notes and government-issued paper money and coins, that does not require endorsement in serving as a medium of exchange; among less developed societies, currency encompasses a wide diversity of items (e.g., livestock, stone carvings, tobacco) used as exchange media as well as signs of value or wealth. In the developed nations, where checks drawn on demand deposits are an important means of transaction, currency may actually account for only a small portion of the total money supply.” 2

References

  1. http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2014/qb14q1.pdf
  2. http://www.britannica.com/EBchecked/topic/147027/currency
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