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Yuan dynasty banknotes are the earliest known fiat money. Fiat money is a currency established as money by government regulation or law. The term derives from the Latin fiat (let it become, it will become) used in the sense of an order or decree. It differs from commodity money and representative money.
This single currency â the euro â was first introduced in 1999 as 'book money', with the national currencies still circulating but having become sub-units of the euro. Then, in 2002, the changeover to the new currency was completed with the introduction of euro banknotes and coins. Today, the euro is the only currency of all the countries in the euro area. This means that you no longer need to exchange coins and banknotes when you cross borders. So trade is much easier, giving us greater choice of what to buy.