From this article by Cory #doctorow

What is Money?

The decade-plus era of cryptocurrency has popularized the answer from Econ 101: “Money is a store of value, a unit of account and a unit of exchange.” That is: money is a thing you can use to save up for future needs (“a store of value”), a way to keep track of what you can afford, what you’re owed and what you owe to others (“a unit of account”) and something others will accept in exchange for their labor or goods (“a unit of exchange”).

Where did it come from?

There’s even a folk-tale about how money came about: in the beginning (the folk-tale goes), we all bartered with one another in the marketplace. I’d bring my fat cows and you’d bring your champion-laying hens and we’d try to arrive at a “confluence of needs” in which you offered me twenty-seven chickens for my third-fattest cow.

But (the tale continues), these confluences were hard to arrive at. What if I only needed twenty-six chickens? Would our deal fall apart? Would you have to go and trade one chicken for something else I was willing to accept, like a decorative gourd or a half-bushel of wheat? How difficult (the tale insists) our trade must have been!

Then (the tale concludes), we agreed upon some intermediate, durable commodity to smooth over these seemingly intractable difficulty: gold! We chose standard quantities and purities of gold (and/or silver, copper, etc) as a unit of exchange, a unit of account and a store of value. You could have my cow for twenty-six chickens and make change with a couple of copper coins.

In this story, money came from the people, a bottom-up consensus phenomenon in which we all agreed to a coinage and therefore money comes from the people.

But wait, taxes?

This story has a corollary. If money comes from the people, then taxes represent an incursion upon the people by governments, who impinge upon the private space of consensual, bottom-up trading activity with a top-down disruption.

That's not true!

There’s no indication that coin money ever emerged spontaneously from the difficulty of arriving at confluences of needs. Rather, the historical record shows us that money is a top-down phenomenon, rooted in the needs and capabilities of states.

Coins came from power

Debt describes our best, most evidence-supported historical understanding of the origin of money in the needs of the empires of the Axial Age (800 BCE to 600 CE). As imperial armies went a-conquering, they needed some way to provision the soldiers garrisoned in their far-flung territories.

The solution was elegant — and terrible. Soldiers were paid in coin, minted and controlled by the state, which punished counterfeiters with the most terrible torments. Conquered farmers were taxed in coin, on penalty of violence and expropriation.

Thus: the soldiers had coin and the farmers needed it. This meant that farmers would be willing to trade their produce for coin, which meant that soldiers would be provisioned. Tax-bills were nondiscretionary liabilities: failure to pay your tax would lead to violence and ruin.

==The value of money, then, came from taxation — from the fact that farmers needed coins. ==This need rippled out through society: even if you didn’t farm, you would accept coins in exchange for your own labor and goods, because the farmers would accept coins in exchange for food (which everyone needs), because farmers needed coin to settle their tax-debts.

Coins became money because there was a nondiscretionary, terrible obligation that you could only fulfill with coins.

Thought Experiment

Note: This is the single most concise explanation of money I've ever seen

Sometimes when economist Warren Mosler is explaining money to an audience, he’ll hold up a handful of his business-cards and ask, “Who will stay after the lecture and help stack the chairs and mop the floor in exchange for one of my cards?”

When no hands go up, Mosler adds, “What if I told you that there were gun-toting security guards at the all the exits, and they will only let you leave in exchange for one of my cards?”

Every hand shoots up.

Mosler has just turned his cards into money, through the creation of a non-discretionary door-tax.

Now, Mosler didn’t need to get his business-cards from the audience before he could levy this tax. He is the sole supplier of his cards, and while the audience will treat them as money, Mosler won’t. Mosler doesn’t need business-cards — he needs people to help clean the lecture hall and stack the chairs. At the end of the night, when the security guards turn over all the collected cards to him, he doesn’t need them — he can’t pay for his airfare to the next lecture using his cards, or pay for his hotel room with them. Indeed, given how cheap business cards are to produce, he can just dump all those used cards in a shredder.

When people say, “Government budgets aren’t like household budgets,” this is what they mean. Mosler isn’t a currency user in this thought-experiment, he’s a currency issuer. Mosler needs your work, not your “money.” He has all the money (Mosler’s business cards). You can’t get money (Mosler’s business cards), except from Mosler. When you pay your door-tax to Mosler’s armed agents, you aren’t giving him your money — you’re giving him his own money back.

Inflation

Now, it’s possible for governments to create too much money. If Mosler hands out too many business-cards to his nightly helpers, it could create a surplus that circulates to future audiences, so that when Mosler announces that you need to help clean the hall and procure one of his cards to leave the room, the smug audience might produce cards left over from previous nights’ crowds and leave Mosler to stack the chairs and clean the floors himself.

Mosler could raise the price of leaving to two cards, or three, or two hundred, but then he might also have to raise the price of the sodas you can buy with his cards from the concession stand at the side of the hall.

Unemployment

But likewise, if Mosler demands too much work in exchange for one of his cards, there may not be enough chairs to stack to provide every audience member with the chance to earn a card and so leave the room. The technical term for these stranded people, unable to find work that will yield up the slip of paper that lets them go about their lives, is unemployed. Mosler created unemployment by spending too little, so that there was no way to earn the tokens that he was the sole originator of.

Moneylike

Money, then, is intrinsically linked to liabilities: something is moneylike if you need it to settle some kind of obligation. If you go to a county fair and buy midway tickets, these are moneylike to the extent that the people you want to trade with desire to ride the midway rides. The kids you bring with you might be willing to promise all kinds of labor in exchange for the tickets: “That wild mouse coaster costs five tickets; I will give you one ticket for every load of laundry you promise to fold.” Your kids might even trade among each other for those tickets: “I’ll let you ride my bike for a whole week if you give me ten of your tickets.”

However, midway tickets’ moneylike properties are weak and short-lived. Your kids won’t accept midway tickets in exchange for chores once you leave the fair. Even the drawing-near of the end of your day might devalue tickets as a medium of exchange. A kid who gorges themself on deep-fried Coca Cola syrup might decide that they don’t want to ride any more rides and thus have no need for midway tickets.

And of course, the fair itself doesn’t need to collect your tickets in order to have enough to offer rides to the next day’s fairgoers — no more than Starbucks needs to collect or borrow gift certificates from people who’ve already received them in order to issue more gift certificates in the future.

Scarcity

A Starbucks gift certificate is also weakly moneylike. In a town full of restaurants and cafes, you might have trouble convincing anyone to accept your Starbucks certificate in exchange for goods or services. But in an airport during a layover where Starbucks is the only thing open, you might get some takers. If the Starbucks cash-register is offline and they can only accept gift certificates, the certificates become more moneylike.

The point is that money can be thought of as “something you need to get something you want, and the more you want it, the more moneylike that thing becomes.”

Crypto Bad

The end of the article goes on to explain that Crypto has no inherent value, it's only valuable for e.g. ransomware, which is extortion for something moneylike.