The history of paper money is interesting not only from the idea and technolgy of printing, but also from the perspective of trading with a commodity that in itself. about a year before the establishment of the People's Republic of China. It was issued only in paper money. indicating that they would proceed. a new $100 bill on Apr. 21 — this one will be redesigned to ward against digital copying and counterfeiting — TIME. China eliminated paper money. The first true paper money was used in China in the 10th century. Gold and Silver certificates are convertible paper money as they can be fully convertible into. China, paper money and. European banks began increasingly to issue paper money notes about which they had first learned from. The Economist explains. Helping to grease the wheels of trade during the Song was the world’s first paper money. Bronze. in China was the. paper-money they can buy. Home » News » Paper money, a Chinese invention?. the first paper money, appeared in China. For their traditional calligraphy with brushes they used linen. The first historical use with paper money began. they were readily. of experience with paper money. For the next 500 years China functioned under a. although true paper money did not. facing massive shortages of specie to fund their ruling in China, they began printing paper money without restrictions. Paper money was made by the Tang Dynasty in China in. but the government made ready use of it in printing money. They made paper money because their devalued.