Chapter 2

In the Ming Dynasty, currency was divided into three types: silver, copper coins, and paper money (baochao).

The economic system of the Ming Dynasty was not based on silver. The original intention was to use paper money as the main currency, with silver and copper coins as supplementary. However, due to the fact that paper money was only issued and never recalled, and its credibility was poor, it continuously depreciated throughout the Ming period. Initially, 1 guan (string) of paper money was equivalent to 1 liang (tael) of silver. By the later period of the Ming Dynasty, it often required 200 guan of paper money to exchange for 1 liang of silver.

Regarding copper coins, the management of copper coins in the Ming Dynasty was often more chaotic than that of paper money. Unlike what is depicted in TV shows and novels, the value could not be calculated in "wen" (units) because copper coins forged in different eras had different names, sizes, and weights. For example, according to historical records, the "Dazhong Tongbao" issued in the early Ming Dynasty could be exchanged for 1 qian (money) of silver with just 4 wen. Later-issued copper coins required 70 to 90 wen to exchange for 1 qian of silver, and if they were inferior coins from the civilian sector, it might take more than 400 wen to exchange for 1 qian of silver.

Therefore, although the Ming Dynasty intended to use paper money as the main currency and copper coins as a supplement, the actual situation was that due to the chaotic management of its currency, silver, which maintained the most stable value, became the main currency of the Ming Dynasty.

However, due to the policies of the Ming Dynasty, small transactions in the civilian sector were still primarily conducted using paper money.

The above information is provided for your understanding. This book will not specifically mention these details.

Additionally, in the new chapter [Volume 2, Chapter 19, Initial Formation of Power (Part 1), Combined Chapter], the bug mentioned that 1 liang of silver was equivalent to 200 guan of paper money, which is based on this concept. However, for the convenience of readers, all currency in the original text has now been changed to silver.

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