When Vikings didn’t rely on mobile money transfers
Haraldr Hardrade – known in English texts as Harald III Sigurdsson, with the epithet “the Ruthless” – was said to be a strong-willed and brutal guy. He was Norway’s king from 1046 until he was killed in the Battle of Stamford Bridge in 1066. Murder and bribery no doubt contributed to his hold on power. He liked to surround himself with others of the same tough calibre – and then some. This story can be found in the Old Norse kings’ saga ‘Morkinnskinna’:
The Icelander Halldorr Snorresson was one of the toughest men in the king’s army, a faithful and long-serving warrior in Byzantine, with lives on his conscience. On the eighth day of Christmas, the soldiers were to receive their wages in the form of the king’s silver coins. But around this time the coins were already being minted with a large proportion of copper.
Halldorr held his pay on a flap of his cloak. The silver coins didn’t look pure. With a swipe of his other hand, he scornfully scattered them all onto the ground and said,
“Why should I serve the king any longer when I don’t receive my payment in pure silver?”
Halldorr refused the king’s coins. He wanted real silver, but it didn’t help that other servants of the king accepted the coins as payment. Nor was Halldorr swayed by warnings that the king would see it as an insult if his long-time servant did not accept the coins.
“Never have I been so deceitful during my service to him, as he was when he paid me,” Halldorr told Bard, the king’s envoy.
Bard brought this message to King Harald and asked for Halldorr to receive payment in the form of “good silver”. The king initially thought that this was unreasonable, but Bard then asked if Halldorr’s courage, their long friendship and the king’s generosity were not reasons enough to make an exception. At the same time he reminded the king of Halldorr’s “contentious disposition,” which probably meant something quite different at that time than it usually does now. “Give him the silver,” said Harald the Ruthless. One of Norway’s strongest rulers acceded to Halldorr’s demands. But why did he insist so vehemently, when it could have cost him his life? Didn’t he trust the king and his currency?
Halldorr was a foreigner in Norway. He was returning to Iceland, according Jon Anders Risvaag, an associate professor at the Norwegian University of Science and Technology (NTNU) University Museum.
Risvaag is the museum’s numismatist, or currency expert, and believes he may understand the reason for the Viking’s aversion to the king’s impure coins. Money has always been dependent on two things.
“You need confidence in the payment method and a central power apparatus that can guarantee it,” says Risvaag.
From early times, a coin’s value was linked to the amount of precious metal in it. Foreign silver coins were used in Norway long before minting started there in 995, and the silver content was more than 90%.
But under King Harald, coins were minted with steadily less silver, down to as little as 30%. This was a way for the king and his administration to save and earn money. At the same time, the central authority would guarantee that these coins were worth as much as before.
The king’s word was perhaps good enough in Norway, and there the money could readily be used as a means of payment. The king himself vouched for the coins’ legitimacy despite the decreased silver content, and his power apparatus made sure that the people followed the king’s decrees. Big protestations weren’t a good idea, either.
But once back home in Iceland, Halldorr couldn’t count on people to accept coins with lesser amounts of the precious metal. There it was weight of the silver that mattered, not the king and his people far away on the mainland.
So what does this mean for us today? Quite a lot, actually. Trust and power are still the basis for a currency’s value.
When you sell tickets to support the school band and accept an electronic money transfer as payment, you’ve actually assessed the situation in the same way Halldorr did. The difference is that you arrived at a different conclusion – you trust that the transaction will go through with no problems. Which is usually the case.
Norwegian authorities have decided that the Norwegian krone (NOK) is legal tender in Norway, where you even trust the banks as intermediaries, and the banks can no longer just fail. State power and guarantees support the law.
Physical cash has largely disappeared and replaced by numbers in our accounts.
That might beg the question whether we lose anything by exclusively relying on electronic money transfers?
Risvaag doesn’t think so. “We’ve already lost anything that could have been lost. This is simply an extension of disconnecting from physical means of payment. It’s a natural development,” he said.
Coins and banknotes are on their way out. There aren’t nearly as many physical means of payment as there is money in the world.