Gold Coinage: From Ancient Civilizations to Modern Considerations.

Gold has been a valuable resource used for trade as far back as the early civilizations of Mesopotamia. However, gold as coinage can be dated to the 6th Century B.C.E. The first coins, produced for the Lydian King Croesus, were actually an amalgam of gold and silver, known as electrum.

The pale gold colored coins were impressed with the image of a lion or bull on one side and a seal on the other. By 560 B.C.E, the Lydians had learned to separate the gold and silver and were issuing fully gold coins. From Lydia, the use of gold for coinage spread across the Aegean to the Greek City-States where it was adopted by Philip of Macedonia and his son Alexander the Great. The Greek coins replaced the images of lions and bulls with portraits of the king. Both Philip and Alexander used gold coins to pay their armies and cover their military expenses.

The Romans continued the Greek custom of imprinting their coins with an image of the emperor. The Roman gold aureus was too valuable for everyday use, but it was commonly used for larger purchases. Treasure chest of gold coins A single gold aureus was one month’s pay for a Roman Legionnaire. During the height of the Roman Empire, between 200 and 400 C.E. gold coins were minted on a scale never before attempted. Used throughout the empire, hoards of Roman gold coins have been found all over Europe and can now be found on display in museums and in private collections around the world. Following the fall of the Roman Empire, there came a decline in gold coinage.

While a beautiful gold coin, known as the bezant, was produced for the Byzantine Emperors, the limited supply of gold at this time resulted not only in a shortage of these coins, but also in a lowered quality for the coins produced. The Roman gold aureus was made of 22 karat gold as compared to the 6 karat gold found in bezant coins from 1081.

Although the gold supply was declining in Europe, it was flourishing in the Middle-East and North Africa. The gold dinar became the coin of choice in the Islamic Empires. Since Islamic law forbids the reproduction of human images, these coins were engraved with beautiful calligraphic versions of Arabic text. During the 1200s gold flowed back into Europe through Venice. Money and goods moved from the Middle-East to Europe, passing through the growing trade center of Venice. The gold entering Europe was turned into ducats, minted in Sicily, Florence and Genoa in the mid-1200s.

The Venetian ducat, introduced in 1284 featured an image of the doge kneeling before St. Mark on one side and an image of Jesus on the other. The gold ducat became the standard symbol of wealth and power for the next 500 years. New Hungarian gold mines found in the 1300s spurred the production of gold coins with mints sprouting up all over Europe. Over the next two hundred years, gold was minted into Portuguese cruzados, British gold sovereigns and Spanish crowns. During the 16th and 17th centuries the declining gold supply led to silver coins replacing gold in most places. But new gold mines in Brazil resulted in a resurgence of gold coins in the 18th century. Gold guineas were produced in mass quantity; up to 4 million coins annually were put in circulation.

The gold mines in the United States in the 19th century provided one last push for gold coins. After World War 1 gold coins disappeared from circulation. While gold bullion coins such as the Krugerrand and the U.S. Eagle are available as investment opportunities, the gold coin, as monetary exchange, is confined to the history books…..Or is it? Since the financial collapse of 2008 many have been calling for return of the gold standard. Financial pundits seem to be divided on the merits of a currency backed by precious metals. However, as uncertainty is rampant over the future of the US Dollar, interest in implementing sound money is growing with Utah state House officially stamping gold and silver as legal tender in march 2011.