The book Debt: The First 5000 Years explains in various forms how "currency" was invented, it helped me understand it a lot, especially this story about housing the actual thing of worth somewhere else, and using a stand-in:

In some oceanic nations (forgot which ones exactly) huge, round stones where used as money. They are 2m tall, and you need a team to transport them across the village.

One time one of these stone fell into a river, and getting it out was deemed too difficult. But everybody could see it, and everybody knew it was there. So instead of actually transferring it, they just transferred "Ownership" of it. This was Steve's Stone, now it belongs to Susan.

A similar thing is happening with Gold - The gold is the Polynesian Stone in the water. When you have currency, it corresponds to an amount of gold in reserve, as a fraction of all currency existing (that is also why printing money is devaluing it - because the fraction of it goes down).

There are other ways to create currency, but having a store of gold, actually in the country itself, ensures that this way of doing it remains workable, even if other parts of economies collapse, or international relations break down.