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The Evolution of Payment Solutions: From Cash to Cryptocurrencies

Humanity’s use of money is known to date back at least 5,000 years, with historians generally agreeing that bartering was likely used in its place before that.

Investopedia defines bartering as “a direct trade of goods and services”, adding the example that “a farmer may exchange a bushel of wheat for a pair of shoes from a shoemaker.”

However, as bartering could be a cumbersome and time-consuming process, easily traded items such as weapons and animal skins were increasingly adopted as currency over the centuries. Eventually, the age of cash beckoned — and many other payment solutions have emerged since.

Coins and banknotes 

Metal coinage was invented in 600 BCE, when King Alyattes — monarch of the now-defunct Asia Minor kingdom of Lydia — minted the Lydian slater, today considered the world’s first ‘official’ currency.

By 1260 CE, China had already been striking coins for centuries, but shifted to paper money that year. In 1685, Canada — at that time a French colony — started issuing playing cards that could be used as cash, as it took a while for coins to be shipped over from France.

Today, we remain accustomed to handling both coins and banknotes, despite physical money’s vulnerability to theft and counterfeiting.

Credit and debit cards 

From about the middle of the 20th century onwards, credit cards started to be introduced, with debit cards following later in the century.

Of course, credit and debit cards work in slightly different ways, with credit card users essentially borrowing money and debit cards fetching money that already sits in the user’s bank account.

Either way, consumers no longer needed to have cash with them in order to make payments — and could enjoy the peace of mind that came with the added level of security.

Online banking 

The onset of the World Wide Web in the 1990s enabled people to check their bank accounts much more quickly and flexibly than before. 

Now, people could just log into a website to look up the amount of money in an account and transfer funds from it, such as to help out a friend or pay bills.

The decade also saw the emergence of online shopping, as typified by the then-nascent Amazon. Still, though people could now make online purchases with their banking details, these needed to be typed manually into ecommerce websites. This inconvenience opened up a market for…

Digital wallets 

In the 2010s, as smartphones saw increasingly widespread adoption, digital wallets services including Apple Pay and Google Pay were rolled out.

With these services, users already have their bank account details saved on their devices. Hence, the device can be configured to simply fetch these details when the user wants to make an online purchase. 

The user can authenticate the payment by using a biometric sensor — e.g. a fingerprint sensor — built into the hardware.

This basically means that an online shopper can navigate the whole checkout stage without having to retrieve a physical credit or debit card.


The term ‘cryptocurrencies’ is used for digital currencies not issued or controlled by central authorities like governments and banks. This is why cryptocurrencies are often described as ‘decentralised’.

Nonetheless, many of the mainstream cryptocurrencies — like Bitcoin and Ethereum — do have some drawbacks, including that they can be prone to volatile fluctuations in value.

This particular risk has been addressed with the introduction of ‘stablecoins’ — basically, cryptocurrencies stabilised with the backing of either a fiat currency or a basket of goods.

Challenges lie ahead

As new payment solutions have arrived, new regulatory challenges have been thrown up. This is especially crucial to heed if you run a business eyeing markets overseas.

While many governments have set out specific guidelines, some territories are riskier than others for businesses to target. For example, some jurisdictions can be much more lenient than others in the extent to which they permit cryptocurrency payments.

Even when not taking cryptocurrency into account, it’s worth pointing out that not all payment solutions are available in all of the territories where you may have been hoping to amass new customers. Thankfully, you can counter these risks.

How your business can prepare for the future

You can expect to see payment solutions further evolve in the coming years. If your business doesn’t keep pace with these changes by adopting new features as they become available, you could risk your brand coming across as increasingly outdated. 

Yes, bartering continues to be used in some areas of the business-to-business (B2B) space — but you would still be able to benefit from looking into modern B2B payment solutions.

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