Dreamstone was present through the earth's history. By 12,000 BC it had been used to harness the power of magic; it is present in Schala's pendant, the Mammon Machine, and the Ruby Knife. Melchior made the Ruby Knife and we see Masa and Mune at the same time--, and it's also implied that he either created them or imbued them with some aspect of the dreamstone or the knife. When the Ruby Knife stabs the Mammon Machine, it becomes the Masamune. Masa and Mune presumably lived through the ages either separate from or inside the sword, surviving to 600AD, where Cyrus and Glenn go to see them. Because Cyrus stands up to them in combat, they become Masamune and give themselves to him. Masamune is the only sword powerful enough to destroy Magus, which is more significant when we later learn that both Masa/Mune and Magus come from the Kingdom of Zeal. When Masamune is cracked, the party needs to get Dreamstone from 65,000,000 BC in order to have it repaired in 1000AD to bring it back to 600AD to get the job done. This helps effectively show us how every time period in Chrono Trigger is linked. The parties actions reach through time, and only by connecting 65,000,000BC to 12,000BC to 600AD to 1000AD are they able to actually set in motion the events that lead to the fateful day.
Without killing Magus, the party would not be sent to 65,000,000 BC. Without the party showing up there, humans would never have beaten the Reptites and Azala's connection to Lavos would never occurs. Without Lavos, Zeal would never have been able to construct the Underwater Palace, the Queen would have never been possessed, and Janus would never have been sent through time by Schala. Without Janus in 600AD, Magus never would have risen and there would have been no war with humanity, which in turn defines the history of the kingdom of Guardia. They're all linked
