It all started with the barter system using commodity money such as animal skin, cattle and salt, grains and foods and even livestock.
Then evolved to precious metals when they were discovered. People used Gold, silver, Copper or nickel as the payment mode.
Next came paper money which was used as receipts issued by Goldsmiths. The receipts were then later used for payments. Now paper money are the notes issued by the state or by the bank, usually the central bank.
Then we have the credit money. Cheques, drafts, and all other instruments offered by the banks. They are more convenient, safe and easily convertible to cash.
Then came the electronic money (also known as e-money, electronic cash or currency). Not so long ago, it came to a point where we didn't have to go to banks anymore to make deposits or transfer money to someone. It involves use of internet and computer networks. Life became a bit easier. Costs were reduced, time was better spent and all, but the banks and the government remain involved till date.
This last stage birthed "Cryptocurrency" with a few modifications.