Paper money was first used in the West in Massachusetts Bay Colony in 1690, was used in limited fashion, became unpopular and then phased out. And that was the end -- paper money was a failure.

Wait....

  The currency was initially unpopular for anything except paying taxes, and was phased out. Within a few years, however, paper currency would return to Massachusetts. The Bank of England began issuing banknotes in 1695, also to pay for war against the French, and they became increasingly common throughout the 18th Century.