Algonquian and Iroquoian Indians used wampum in strings and belts to record events and as a medium of communication. A belt recording William Penn's treaty with the Delawares has been preserved. It shows two figures in dark beads against a background of white beads in 18 rows. The figure representing Penn clasps the hand of the other, an Indian. Strings of beads were similarly used on the Pacific Coast, and shell beads are commonly found in ancient burials all over America.

Because of their origin as a memory aid, loose beads were not considered to be high in value. Rather it is the belts themselves that are wampum.

Belts of wampum were not produced until after European contact. A typical large belt of six feet in length might contain 6000 beads or more. More importantly, such a belt would be a great sanctity, because it contained so many memories. Wampum belts were used as a memory aid in Oral tradition, where the wampum was a token representing a memory. Belts were also sometimes used as badges of office or as ceremonial devices of an indigenous culture such as the Iroquois. Wampum is also considered the end product of whelk and quahog, i.e. the belts to show leadership.

The Value Of Wampum

When Europeans came to the Americas, they realized the importance of wampum to Native people, but mistook it for money.  While the Native people did not use it as money, the New England colonies used it as a medium of exchange. Soon, they were trading with the native peoples of New England and New York using wampum. The New England colonies demonetized wampum in Dutch colonists actually began to manufacture their own wampum.

The black shells were considered worth more than the white shells, which lead people to dye the latter and diluted the value of the shells. The ultimate basis for the value of the shells was their redeem-ability for pelts from the Native Americans. As Native Americans became reluctant to exchange pelts for the shells, the shells lost value. With stone tools the process is labor intensive, and the shells were available only to coastal nations.

These factors increased its scarcity and consequent value among the European traders. Dutch colonists began to manufacture wampum and eventually the primary source of wampum was that manufactured by colonists, a market the Dutch glutted.

European traders and politicians, using beads and trinkets, often exploited gift exchange to gain Native American favor or territory. With the scarcity of metal coins in New England, Wampum quickly evolved into a formal currency after European/Native contact, it's production greatly facilitated by slender European metal drill bits. Wampum was mass produced in coastal southern New England. The Narragansetts and Pequots monopolized the manufacture and exchange of wampum in this area.

Even in the 1600s there was noted distinctiveness of Native-made wampum and the inability of others to counterfeit it, although attempts at imitations included beads of stone and other materials.

Strung money was known as wampumpeage, or merely peage. Customarily arranged in lengths of one fathom (6 feet), which contained anywhere from 240 to 360 individual beads, depending not only on the size of the beads but on their current worth, for "fathom" soon came to denote a specific monetary value. Individual strands were then worked into bands from one to five inches wide, to be worn on the wrist, waist, or over the shoulder, ... Occasionally the Indians fashioned great belts containing over ten thousand beads".

A fathom (six feet of strung beads) of white wampum was worth ten shillings and double that for purple beads. A coat and Buskins set thick with these Beads in pleasant wild works and a broad Belt of the same belonging to King Philip (Wampanoag) was valued at Twenty pounds.

With the increased manufacture after European contact, these beads were carried inland along indigenous trade routes as far as the Great Plains and as far south as Virginia. By the 1700's the Dutch Europeans began to fabricate vast quantities in factories such as the Campbell wampum factory New York.

The use of wampum as money, even among the English, continued until the American Revolution. Important matters such as treaty agreements were likely to be marked by an exchange of Wampum belts, with designs in two colors, which thereafter served as visual reminders of the event itself, and to call to memory the arrangements agreed on.

Wearing Wampum

Wampum belts were used as a memory aid in Oral tradition, where the wampum was a token representing a memory. Belts were also sometimes used as badges of office or as ceremonial devices of an indigenous culture such as the Iroquois.

Long, wide belts of wampum were not produced by Native Americans until after European contact. However, the methods and techniques used in making large wampum belts probably developed from the ancient Native American traditions of finger-weaving. Some of the earliest post-European contact wampum belts were worn as collars around the neck. These early wampum collars are made without the use of a loom, much like prehistoric finger-weaving, with one end of the belt anchored and the other end left free to weave the warp and weft elements on a bias (diagonal). The very first woven wampum most likely incorporated single beads strung onto twine while finger-weaving sashes, garters, burden-straps or other bands. The belt weaving technique known as 'double-strand square weave appears earlier (late 1500's and early 1600's) than the 'single-strand square weave' technique.

Bow Loom used in New England  to weave wampum belts.

Personal headbands and bracelets might combine shell with glass or metal beads. Many Native American headbands and bracelets in the 1600's in southern New England incorporated squares, triangles, diagonal lines, crosses, people, animals and other geometric shapes. Belt designs might show kinship or connection with a particular group. Belts and beads validated treaties and were used to remember oral tradition.

Ceremonies of dance, curing, personal sacrifice incorporate religious and ritual aspects of beads. Jewelry was also used to display many physical or social "rites of passage", and shows that a person has gone through a certain transformation in their life, like maturity or marriage. Wampum could be presented by the family of a prospective husband to the family of a potential wife, and if accepted, granted approval for the marriage.

The young man, when he had settled his mind upon marrying some special girl, would appoint an uncle, or some elderly man to be his go-between. Extra dignity was lent to the occasion by having two old men for negotiators. He would then procure some wampum, if he were rich enough a collar or necklace, if not, just a string. Next he would compose a message, the main points of which would be represented by the arrangement of white and purple beads. This message, accompanied by the mnemonic wampum, would be forthwith entrusted to the go-between's care, and he would go to the home of the girl's parents carrying the wampum in a rolled-up red handkerchief or other gaudy cloth. Here his message would be delivered, and the wampum left , to be debated upon by the girl's family. The negotiator would depart for a while to allow time for deliberation. Before long he would return for an answer. Now should the girl's family have decided negatively, the wampum would be returned to the old man, who would deliver it to the sender. And the matter was dropped. But should the suitor be favorably regarded, the wampum would be retained and upon the negotiator's next visit he would be answered in the affirmative or asked to defer a little longer. The retention of the wampum was considered a sign of consent. It often happened that the husband, after the wedding, would buy back the wampum.