Rai stones are a unique form of traditional stone currency used on the island of Yap in Micronesia. Here are the key points about rai stones:

1. Description: Rai stones are large, circular discs carved from limestone, with a hole in the center. They range in size from small 3.5 cm discs to massive stones up to 3.6 meters in diameter and weighing up to 4,000 kg[2].
2. Origin: The stones were quarried on the island of Palau, about 400 km away from Yap, and transported back by canoe. This difficult and dangerous process contributed to their value[1][3].
3. Value system: The value of a rai stone was determined not just by its size, but also by its shape, quality, and the difficulty of acquisition. Stones that cost lives to transport were considered more valuable[3].
4. Ownership and transactions: Rai stones were rarely moved due to their size. Instead, ownership was tracked through oral history and community knowledge. When a stone changed hands, everyone in the community would be informed of the new owner[1][3].
5. Historical development: The use of iron tools and European ships in the 19th century led to the creation of larger stones. David Dean O'Keefe, an Irish-American trader, significantly increased stone money production by transporting them on his ship[2][3].
6. Modern usage: While the US dollar is now the common currency in Yap, rai stones are still used for major traditional transactions like dowry payments or land purchases[3].
7. Economic interpretation: Some economists, like Milton Friedman, have drawn parallels between the rai stone system and modern monetary systems, noting similarities in how value is assigned and transactions are recorded[2].
8. Cultural significance: Rai stones remain an important part of Yapese culture and are a national symbol, appearing on license plates and used in cultural celebrations[3][4].

The rai stone system demonstrates how value can be assigned to objects through shared belief and record-keeping, even when the objects themselves are impractical to move or exchange physically.

Citations:
[1] https://www.financemagnates.com/thought-leadership/the-rai-se-and-fall-of-the-first-distributed-ledger-yap-stones/
[2] https://en.wikipedia.org/wiki/Rai_stones
[3] https://mantaray.com/discover-yap/the-history-of-stone-money/
[4] https://blog.hmns.org/2015/05/hard-currency-stone-money-of-the-yap-islands/