At the time of the Spanish conquest, cocoa bean currency in the commercially active economy of the Aztec empire ranked above gold dust as the principal form of money. The Aztecs kept cocoa beans in bags holding 24,000 beans. Columbus met with a Yucatan ship hauling goods to trade for cocoa. One early observer of the Aztec society, Peter Martyr, noted regarding Aztec money: “Oh, blessed money which yieldeth sweete and profitable drinke for mankinde, and preserveth the possessors thereof free from the hellish pestilence of avarice because it cannot be long kept hid underground” (Einzig, 1966). The Aztecs also used copper hatchets as money and Cortez, in a letter to the king of Spain in 1524, referred to a copper hatchet as worth 8,000 cocoa beans. During the eighteenth century reports from Mexico indicated that the cultivation of cocoa beans was restricted to maintain the value of cocoa beans as money. Cocoa bean currency was not even spared the episodes of debasement that haunted the early history of precious metal currencies. Debasement of cocoa bean currency was accomplished simply by removing the stone of the cocoa bean and replacing it with dirt.
Girolamo Benzoni, writing in 1572, said that the Spanish inhabitants of Guatemala held their wealth in the form of cocoa. Henry Hawks, a merchant who spent five years in Central America, writing in the same year, claimed that in Guatemala cocoa “goeth currently for money in any market or faire, and may buy any flesh, fish, bread or cheese, or other things” (Einzig, 1966). When Thomas Cavendish landed at Aguatulco in 1587 he found 400 bags of cocoa beans stored in the Customs House, “every bag whereof is worth ten crownes.” Master Francis Petty, who accompanied Cavendish, wrote “These cacaos goe among them for meate and money. For a hundred and fifty of them are in the value of one rial of plate” (Einzig, 1966). To preserve the local supply of money, Guatemala enacted an ordinance banning the export of cocoa unless payment was in coin. Cocoa bean currency stretched into Latin America. In 1712 a royal decree in Brazil listed cocoa, cloves, sugar, and tobacco as commodities that legally circulated as money and troops were paid in these commodities. In nineteenth-century Nicaragua 100 cocoa beans bought a serviceable slave.
The use of cocoa beans as money continued into the nineteenth century, and remote Indian tribes in Mexico and Central America continued to make small change with cocoa beans into the twentieth century. Within these tribes the smallest silver coin equaled 40 cocoa beans.
The history of cocoa beans as money stands as a reminder that money evolves in a social context. Money is something that everyone will accept in exchange. Any product that holds up as universally acceptable to everyone necessarily has social significance, whether it be cocoa beans among the Aztecs, or cigarettes in a prisoner-of-war camp. Cocoa beans were perishable and bulky to transport in large quantities—serious drawbacks as a form of money. Aztecs, however, placed an important ceremonial value on a bitter cocoa bean drink, the precursor to hot chocolate. Montezuma, the Aztec ruler of Mexico, always drank one of these drinks before visiting his harem.