Lending markets

Chinese Knife Money: Making Markets Murderous?

The era of “cash as king” is fading. Today, credit, debit, and digital currency have begun to slowly replace cash as the primary means of payment, but it wasn’t always that way. For centuries, paper money and metal coins have been traded around the world. But did you know that there are forms of money that predate these familiar forms of money?

The Evolution of Currency in the Zhou Dynasty

Humans have used metal coins for thousands of years, but before that (at least in China) currency was designed to look like the common goods of the time. The Zhou dynasty in China lasted from 1100 BC to 256 BC. However, from 700 BC, the state of Zhou was in decline, leaving matters of coinage to be decided primarily by local governments.

The origin of these forms of currency is still debated by numismatists, or currency and coin specialists. Some believe that knife money originated when a Chinese prince ran out of funds to pay his soldiers. He then allowed them to swap weapons instead. Another version of the story claims that the prince fined his people such huge amounts that they could not hope to pay. In turn, he decided he would accept knives as payment. These stories, however, seem to be just that. There is no scientific consensus on the origin of knife silver.

The state of Chu was the first to use a common object as currency, in the form of cowries. When there were not enough shells for everyone, imitations were created in bone, stone and even bronze. Money spades, known as jin, was common in Shanxi and Henan provinces. These fragile hollow-bodied pieces date back to 1200 BC. J.-C. and are the first examples of tools imitating the currency.

Knife money, or daobi, emerged around 700 BC (although this is still debated) in the provinces of Qi, Yan and Zhao. Some early forms of currency were designed so that they could still be used as knives, although the edges were rarely sharpened. In addition, there were different styles of knife money. The design changed depending on where and when the coins were minted.

Collection of Chinese numismatic charms and amulets (Scott Semans / CC BY 3.0 )

The many forms of Dao Bi knife money

The general form of knife money goes back to the xue, a scraper blade with a ring at the end of the handle. A common feature of many forms of dao bi is the ring that they too have at the end of their handles, which, according to the first numismatist WB Dickinson, was used to thread the money on his belt. Here, however, the common features end.

Modern numismatists believe that the sharp knife was the earliest example of knife money. These bear a manufacturing resemblance to some forms of spade money, and are therefore thought to have emerged around the same time.

Ming knives were the most common form of knife currency. Each is inscribed with the character “Ming” on one side. There are several variants of Ming knives, differentiated by the curvature of their blades. Some have a more angular blade, while others are slightly curved. These are believed to have evolved from sharp knives.

Straight knives are, as their name suggests, with a straight blade. They are the first to bear inscriptions supposed to correspond to specific mints. Heavy knives are sometimes considered the earliest form of knife money, but this is debated among scholars.

Ancient Chinese Bronze Qi Knife Coin ( Public domain )

Qi knives: the rarest form of knife currency

There are several categories of Qi knives, determined by the number of Chinese characters inscribed on one side of the blade. Three-, four-, five-, and six-character knives have been discovered, but all are quite rare.

Six-character knives are the rarest, and numismatists believe they were minted as a commemorative coin to mark Tian He’s rise to power in 386 BC. His ascension ended the six-century rule of the state of Qi by the House of Jiang.

There is a lot of mystery and disagreement regarding the knife’s money. Archaeological excavations continue discover specimens , but their relative rarity means there’s still a lot to learn. In the 4th century BC. Several states in China began minting round coins with holes in them. When Qin Shi Huangdi became the first emperor of China, he issued a standard currency known as the Ban Liang , which were round coins with a square hole. The coinage of cowries, shovels and knives was abandoned and thrown into the ground, only to be unearthed centuries later.

Top image: Chinese silver knife. Source: sytilin /Adobe Stock

By Mark Johnson