Legal tender includes any form of payments that is acknowledge/legalized by the government in that country. (Could be money, checks, gold, or crypto currency as long as the law allows it)
Most creditors demanded to be paid in legal tender because it is much easier to liquidate compared to payment using objects. If they received payment through non-legal tender (such as livestock), they have to re-sell that livestock in order to actually get their money. This added another expense/work for them along with additional risk in case they fail to sell the livestock.
