Tales of Soft Money — Oceans of Wealth
If you have followed this series on various historical examples of money this far, you probably know by now that seashells were used as money as well. Nick Szabo has described such uses among North American tribes and among European settlers. To further dispel the notion that such monetary systems randomly emerged due to some idiosyncratic social or political circumstance for that continent, this article provides eyewitness accounts on the use of seashell money in Africa and in Asia, and also provides accounts on the logical conclusion of such monetary systems in the face of economic forces.
In Henry Yule's 1874 version of the recounts of Marco Polo's travels, there are multiple instances of where Polo runs in to this phenomenon, and where Yule consequently discusses it. The first mention is when Polo enters the landlocked province of Carajan, which is modern day Yunnan in China:
Their money is such as I will tell you. They use for the purpose certain white porcelain shells that are found in the sea, such as are sometimes put on dogs' collars; and 80 of these porcelain shells pass for a single weight of silver, equivalent to two Venice groats, i.e. 24 piccoli. Also eight such weights of silver count equal to one such weight of gold.
They have brine-wells in this country from which they make salt, and all the people of those parts make a living by this salt. The King, too, I can assure you, gets a great revenue from this salt. 
Not only the seashell-money reference is interesting. The mention of salt production is something we know may have to do with salt-based monetary systems in other provinces where that commodity was relatively scarce. Ten days west of where the above monetary system was in operation, yet still in the same province, Polo observed seashell money again:
In this country gold-dust is found in great quantities; that is to say in the rivers and lakes, whilst in the mountains gold is found in pieces of larger size. Gold is indeed so abundant that they give one saggio of gold for only six of the same weight in silver. And for small change they use the porcelain shells I mentioned before. These are not found in the country, however, but are brought from India. 
Five days further west, in the province of Zardandan, the same type of sea-shells were used as money as well, and the gold-to-silver ratio were even lower at 5, as the closest silver mine according to Polo was situated a long journey away. In yet another province that Polo refers to as Coloman, and which Yule has trouble mapping to the provinces of the modern world, sea-shells and gold were used as money.
The seashell money of landlocked Asian provinces clearly interested Marco Polo, and he was lucky enough to also pass what might have been the origin of said seashells after leaving modern day Vietnam for what he called Locac, which Yule and others believed to be Siam at the time of translation - in other words modern day Thailand:
In this country the brazil which we make use of grows in great plenty; and they also have gold in incredible quantity. They have elephants likewise, and much game. In this kingdom too are gathered all the porcelain shells which are used for small change in all those regions, as I have told you before. 
Yule provides further sources that such seashells might have also been collected in abundance from the Philippine islands, further east.
Not trusting conclusions drawn from single sources, it is worth to also explore what other early travelers had to say about seashell money. First up is Ibn Batúta, as he stayed on the Maldive Islands in the 14th century:
The inhabitants of these islands use cowrie shells as money. This is an animal which they gather in the sea and place in pits, where its flesh disappears, leaving its white shell. They are used for buying and selling at the rate of four hundred thousand shells for a gold dinar, but they often fall in value to twelve hundred thousand for a dinar. They sell them in exchange for rice to the people of Bengal, who also use them as money, as well as to the Yemenites, who use them instead of sand [as ballast] in their ships. These shells are also used by the negroes in their lands; I saw them being sold in Málli and Gawgaw at the rate of 1 150 for a gold dinar. 
This account from Batúta is quite fascinating. The sheer discrepancy between valuing a gold dinar at 1 200 000 shells in the Maldives, and valuing a gold dinar at 1 150 shells in the west-African kingdom of Mali is incredible. Yemenite seafarers using seashells as ballast is also something that gets your imagination going; as they unloaded these shells closer to African markets, it is easy to see how much gold dinars they must have been able to pocket in upcoming sales. And finally, while Polo casually mentioned India as containing the ports of seashell import, Batúta mentions Bengal specifically, which might have been where Siamese seashells were exported at the time, only to be transported further inland to the landlocked mountain regions. In the Albert Gray translation of 'The Voyage Of Francois Pyrard Vol I', the French navigator François Pyrard de Laval observed similar movements of seashell money as he and his fellow countrymen where shipwrecked and held captive in the Maldives:
There is another kind of wealth at the Maldives, viz, certain little shells containing a little animal, large as the tip of the little finger, and quite white, polished, and bright: they are fished twice a month, three days before and three days after the new moon, as well as at the full, and none would be got at any other season. The women gather them on the sands and in the shallows of the sea, standing in the water up to their waists. They call them Boly, and export to all parts an infinite quantity, in such wise that in one year I have seen thirty or forty whole ships loaded with them without other cargo. All go to Bengal, for there only is there a demand for a large quantity at high prices. The people of Bengal use them for ordinary money, although they have gold and silver and plenty of other metals; and, what is more strange, kings and great lords have houses built expressly to store these shells, and treat them as part of their treasure. 
Curiously enough, the only reason the Frenchmen were able to escape their captivity was a Bengal raid on the islands - something that very well might have had to do with the Bengali commanders realizing this is where money was produced and possibly stored.
Not only did seashell money emerge in Asia and Africa's western parts; Paul Einzig has gathered many accounts from Germans who observed the use of cowries in modern day Uganda, in eastern Africa:
When cowries first made their appearance, they, too, were very valuable. It was possible to buy not only cloth and food but even boats and slaves with cowries. Two cowrie shells would purchase a woman. Subsequently large quantities found their way into the country. They became the principal medium of exchange and were also extensively used as a standard of value. In 1911 the value of a cow was 2 500 cowrie shells, that of a goat was equal to 500 cowries; a fowl was sold for 25 cowrie shells and a cock for 50; an ivory tusk weighing 62 lb sold for 1 000 cowrie shells. [...]
With the penetration of European civilization through the construction of the Uganda Railway, coins gradually took the place of cowries. As a result cowries depreciated. In 1896 cowries were exchanged for about 200 to the rupee, but by 1901 the exchange rate rose to 800. After 31 March 1901, cowries ceased to be acceptable in payment of taxes. At the same time the Government placed an embargo on the import of cowries, having received information that large amounts were being imported from German East Africa. 
Similar inflationary pressure phased cowrie shells out as money in the parts of West Africa where Batúta had observed the use of seashell money - an event that Einzig covers as well under the chapter 'Cowrie Crises in the Former French Sudan'.
All of the above complicated networks and century-long flows of money serves as examples of how money lives and dies. This article is not investigating exactly what species of seashells were used as money, but rather emphasizes the logical framework in which seashell money is first valuable, then falls in value as producers of that money put hands to the task of providing more units to those markets. I welcome anyone to map these network more thoroughly.
 Marco Polo. (1271-1295). The Book of Ser Marco Polo, the Venetian Vol II. Translated by Colonel Henry Yule, C.B. London: John Murray, pp.52-53.
 Ibid., p.62.
 Ibid., p.257.
 Ibn Batúta. (1325-1354). The Travels of Ibn Batuta. Translated by Samuel Lee. London: The Oriental Translation Committee, p.243.
 Pyrard, F. (1619). The Voyage of Francois Pyrard Vol I. Translated by Albert Gray. London: The Hakluyt Society, pp.236-239.
 Einzig, P. (1949). Primitive Money: In its Ethnological, Historical and Economic Aspects. London: Pergamon Press Ltd, p.124.