The history of Chinese currency involves decades of rare silvers and unique processes
China’s form of currency in the distant past consisted of mere coins. These coins were the product of copper, iron, lead, silver and gold, and they came in various shapes, weights and markings. These ancient coins have a big influence on archaeology.
Folks during this ancient time used coins for smaller transactions and sycee for bigger ones. Which was why sycee was considered as money of the rich back then. In fact, some of the poor have never even seen a sycee in their lifetime. Sycee was a type of silver ingot currency, and it is very rare compared to numismatic coins. Sycee is handcrafted and no two sycees are completely alike.
Due to the long-term scarcity of silver in China, sycee was highly-priced. In fact, its price remained consistently higher than its value in Western societies—Roman, Byzantine and Persian. In the Tang Dynasty, Silver began to be transported to China to generate economic revenue, particularly by Persians and Arabs, as a result of the persistent demand for the metal.
Domestic silver production increased dramatically in the Sung Dynasty. The annual national silver production ranged from 210,000 to 880,000 taels in the Northern Sung. This increased supply of silver was supported by accounts of the enormous quantity of silver continually paid to its enemies, Liao, Western Xia and Jin Dynasties, as tributes or war compensation.
In the early Yuan Dynasty, the importance of silver as currency increased substantially, namely in the Mongolian Empire from 1206 to 1271, and the Yuan Dynasty from 1271 to 1368. The new Mongolian rulers carried the idea with them that one of the empire's main currencies should be silver.
When the empire agreed to follow its former enemies' paper note policy, the circulation of silver started to be limited or even prohibited by the Southern Sung and Jin Dynasties. However, this temporary setback did not dissolve the prominence of silver. In fact, the empire's unrestricted issuance of paper notes produced severe inflation. As a consequence, silver was used by citizens in secret instead of the devalued paper money in the remainder of the Mongol Empire.
In the Yuan Dynasty, when Kublai Khan's Mongolian troops invaded Yunnan and incorporated this remote south-western region into China's territory, China received its most valuable domestic supply of silver. The contribution of Yunnan's silver mines has led to a doubling of national silver production.
Huge quantities of silver produced by the Spanish colonial mines of Potosi, Peru and Mexico began to be carried directly or indirectly into China in the late 16th century. Between the later part of the 16th century and the outbreak of the Opium War, over 515,600,000 Spanish silver dollars were transferred into China.
The silver transported from the New World to China was in the form of silver cobs and round coins. Initially, for domestic circulation, these were melted down and recast as silver ingots. After several decades of testing foreign silver with chops and chisels, the Chinese community eventually started to agree that foreign silver had a standardised weight and a level of purity that is deemed acceptable in society.
The silver was freely exchanged by Spanish cobs and pillar dollars, Dutch ducatons, and later, Mexican eagle dollars, American trade dollars, and many more from other nations. The evolution of Chinese silver ingots was widespread and astounding at the end of the Ming Dynasty and the beginning of the Qing Dynasty. Different regions in the nation began to devise their own local forms, unit weight, weighing scale and finesse level for silver ingots.
It was predicted that the natural progression for the type, weight, and consistency of a currency to become streamlined, condensed, and unified after a thousand years of circulation. However, the production of the Chinese silver ingot currency was in the opposite direction. It started with the Tang Dynasty’s 50 taels rectangular bar and the Sung Dynasty’s axed ends coupled with waisted ingots.
Then it continued to the Yuan Dynasty’s ingots with their own distinctive shape. The rims at the ends started to stand up during the Ming Dynasty, appearing as ears or wings to create a preliminary boat shape. Additionally, distinct varieties of sycee were formed during the Qing Dynasty such as Drum, Groove, Square, Trough, Waist, Round, and Saddle. There are also varieties such as “Big-winged” and “Tortoise” as even the boat shape underwent further evolution.
Severe complications and difficulties began to increase every time a silver pattern was changed. The casting process of each new silver pattern often required more expertise and workmanship, and more people involved in weighing and managing it were needed for the entire silver currency system.
As a result, there was a strong employment rate but it made the entire process inconvenient and expensive. Although it kept many citizens employed, silver was no longer affordable or easily accessible. Progressively, foreign silver coins were employed. And from 1890, Chinese machine-struck silver coins were circulated, but in 1993, China eventually demonetised silver taels, as most of the silver ingots then were melted down for the coining of silver dollars.
As we celebrate the Chinese New Year, a season filled with red packets of cash, it is truly remarkable to look back at the development of the Chinese currency. With that being said, we wish you a year filled with good health and prosperity!
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