Demand for a good arises from its perceived benefit. For instance people demand food because of the nourishment it offers them. With regard to money, people demand it not for direct use in consumption, but in order to exchange it for other goods and services. Money is not useful in itself, but because it has a prior exchange value, it is exchangeable in terms of other goods and services. Money is thus demanded because the benefit it offers is it's purchasing power i.e. its price.
Most economic thinkers regard the acceptance or demand for money as a paradox.
In other words I accept money because you accept it and vice versa. Following the view of Plato and Aristotle, economists regard money as an historical fact, that was introduced by government decree 1 . It is government decree, so it is argued, that makes a particular thing accepted as general medium of the exchange i.e. money. However, for something to be accepted as money, it must have a pre-existing purchasing power, a price. We know that the price of a good is the result of the inter-action between demand and supply.