Kiwango cha karatasi kinachukua sarafu ya karatasi kama chombo cha mzunguko. Sarafu ya karatasi ni maelezo ya hati za mzunguko zilizotolewa kwa manufaa ya mmiliki wake, ambazo zinawakilisha deni maalum lililodhaminiwa na Dola au mamlaka ya sarafu iliyoitoa, iwapo karatasi hii ni badala ya dhahabu au fedha, au karatasi iliyodhaminiwa kwa dhahabu au fedha.

The paper standard takes paper currency as the tool of circulation. Paper currency is an expression for circulated vouchers issued for the benefit of its bearer, which represent specific debt secured by the State or currency authority that issued it if this paper is a substitute for gold or silver, or secured paper backed by gold or silver.

Sarafu ya karatasi inaweza kuwa badala ya dhahabu au fedha inayomilikiwa na Dola, kwa namna ambayo inaiwakilisha kikamilifu, yaani dhahabu au fedha inayoiunga mkono sarafu hii inayozunguka inawakilisha thamani yake kwa asilimia 100. Hivyo, mwenye sarafu hii ya karatasi inayowakilisha ana haki ya kuibadilisha kuwa dhahabu au fedha, kulingana na akiba hiyo, wakati wowote anapotaka bila masharti wala kikomo. Sarafu hii inayowakilisha inachukuliwa, kiukweli, kuwa ni ya mfumo wa metali. Kinachotokea ni kwamba badala ya dhahabu au fedha zenyewe kuzunguka, sarafu hii inayowakilisha inachukua nafasi yake katika mzunguko kwa sifa yake kama mwakilishi wake.

Paper currency can be a substitute for gold or silver possessed by the State such that it represents it completely i.e. the gold or silver backing this circulating paper represents 100% of this value. So the bearer of this representative paper currency has the right to exchange it into gold or silver, according to this cover, whenever he wants without any restriction or limit. This representative currency is considered, in reality, to be of the metallic system. All that happens is that instead of circulating gold or silver themselves, this representative currency takes their place in circulation in its capacity as their representative.

Pia, sarafu hii ya karatasi inaweza kufunikwa kwa sehemu ya thamani yake kwa dhahabu au fedha, kwa kiwango maalum na kilichowekwa. Sarafu ya aina hii ya karatasi inajulikana kama "sarafu iliyofungwa" (secured currency). Licha ya hayo, haifunikwi kikamilifu na dhahabu na fedha; uaminifu wake unatokana na uaminifu wa mamlaka inayoitoa. Sehemu yake iliyofunikwa kwa dhahabu au fedha ni sarafu inayowakilisha dhahabu au fedha, ilhali sehemu iliyobaki isiyofunikwa ni sarafu ya karatasi iliyofungwa kwa kiasi, ambayo nguvu ya mzunguko wake inategemea imani ya watu kwa mamlaka iliyoitoa.

Also, this paper currency can be covered for a part of its value in gold or silver, in a specific and limited proportion. Such paper currency is known as “secured currency.” Despite this it is not covered completely by gold and silver, its trustworthiness results from the trustworthiness in the authority that issues it. The portion within it covered by gold or silver is currency representative of gold or silver, whereas the remaining not covered portion is secured paper currency whose circulation strength depends upon people’s confidence in the authority that issued it.

Aina ya tatu ya sarafu ya karatasi ni sarafu ya karatasi isiyo na dhamana yoyote ya dhahabu wala fedha, wala haiwakilishi dhahabu wala fedha. Hii inajulikana kama "sarafu ya karatasi ya lazima" ambayo haibadilishwi kuwa dhahabu wala fedha. Thamani yake inategemea nguvu ya msamaha wa madeni wa umma ambao sheria inaipa. Haina thamani ya asili ndani yake yenyewe; badala yake, thamani yake inategemea sheria inayoilazimisha, kama sarafu ya lazima. Ikiwa sheria ingefuta miamala inayohusu sarafu hiyo, au watu wakapoteza imani nayo, basi ingekuwa haina thamani yoyote.

The third type of paper currency is paper currency without any gold or silver backing at all, nor is it representative of gold or silver. This is known as “compulsory paper currency” that is not exchangeable for gold or silver. Its value depends upon the strength of the public remission of debt which the law grants to it. It has no intrinsic value in itself; rather its value depends upon the law that obliges it, as compulsory currency. If the law were to abolish transactions involving it or people lost confidence in it, then it would become worthless.