To help finance the war in 1775, the Continental Congress issued paper currency called “Continental.” This quickly deflated due to a lack of backing and the rise of counterfeits.

Fiat currency, like the U.S. dollar, is a form of money created by a government and accepted as legal tender within that government's jurisdiction.

Proposed Paper Currency. Share full article. Jan. 22, 1862. Credit... The New York Times Archives. See the article in its original context from January 22, 1862, Page 3 Buy Reprints.

Listener Muhammad Arbaz Khan asks: I usually wonder what would happen if paper money suddenly became obsolete altogether and every transaction was required to be digital.

In fact, the value of paper currency out there is bizarre: $2.3 trillion, or roughly $7,000 for every man, woman and child in America. About half that total is probably held overseas, but still.