The taxes though, were collected in coins. Paper money was really first seen around the time of the Revolution. In 1775 the Continental Congress authorized the printing of Continental Currency which had no gold or silver backing. Money as you know it today is not commodity money. Today most money is what we call fiat money .
Fiat money is money by government decree .
Wampum was the first fiat money used in the America's. It had a set value, equal to a certain amount of gold, established by Connecticut in 1645. Since the government of Connecticut established it as official money it is fiat money. The concept of paper currency was not well regarded early on. Most Americans, indeed most people world wide, felt that paper currency was risky since it had no inherent value.