What did merchants use for money?

Trade along the Silk Road was conducted using a combination of barter and monetary exchange. Silk, exported in huge quantities from China, was in effect a form of currency (it was also a form of tribute used to buy off the nomads), but due to its perishable nature relatively little has survived. Coins, on the other hand, have been found at widely dispersed sites along the Silk Road, providing evidence of routes, the circulation of currencies, and of cultural exchange.

The two major currencies of the Silk Road, the silver drachm of Sasanian Iran and the gold solidus of the East Roman or Byzantine empire, were struck (stamped) from precious metals. Because their metal was never debased nor their weight reduced, they were ideal for transnational trade. Chinese coins were cast bronze and enjoyed little circulation outside China.

Numerous Sasanian and Byzantine coins have been found in Gansu and Ningxia, particularly in the tombs of officials and merchants of foreign descent. However, it is not certain to what extent they were used as currency, since some are pierced for use as pendants or clothing embellishment and others are not true coins but imitations.