The origin and history of coins

In both the East and the West, coinage proper was preceded by more primitive currencies, nonmonetary or semi-monetary, which survived into the historic age of true coins, and may have derived originally from the barter of cattle, implements, and the like. The earliest currency of China of the 8th century BC consisted of miniature hoes and billhooks (pruning implements), with inscriptions indicating the authority. The small bronze celts (prehistoric tools resembling chisels) and bronze rings frequently found in hoards in western Europe probably played a monetary role. Even in modern times such mediums of exchange as fishhook currency have been known.

Metal has always achieved wide popularity as an exchange medium, being durable, divisible, and portable; and the origins of true coinage lie there. Ancient Egypt, which was using gold bars of set weight from the 4th millennium BC, eventually developed a currency of gold rings (but it did not adopt the use of coinage in foreign trade until the late 4th century AD). In the Middle East, gold rings long served the dual purposes of adornment and currency, supplemented by gold and silver bars from which segments could be cut. The choice of metal was, as usual, determined by availability. Around the Aegean Sea, heavy copper ingots were used as currency several centuries before the invention of true coinage. These ingots, known as talents, were originally a unit of weight of roughly 55 to 60 pounds (more than 25 kg); talents were later used as a measure of value. The discovery of an iron bar with a handful (drachma) of fractional iron spits (obeloi) dedicated in the Heraeum (a temple of the goddess Hera) at Argos, perhaps as part of King Pheidon of Argos’ reforms of weights and measures in the 7th century BC, shows such currency continuing until historical times. Similar bundles of spits have been found elsewhere and are evidence of the desire to subdivide a cumbersome unit into smaller fractions for normal use. At the other end of the scale, there was, ultimately, the desire to express the value of a talent of copper or iron in terms of gold or silver; and Homer, who speaks of metal basins, tripods, and axes as gifts and prizes in a way that shows them as a recognized standard of wealth, also speaks of the talent of gold (i.e., the value of a heavy base-metal talent expressed in a little pellet of gold). In Italy rough lumps of bronze (aes rude) formed a currency from early times, being succeeded by bars of regular weight; and Julius Caesar’s record of the ancient British use of iron bars as currency (following his raids on Britain in 55 and 54 BC) is still borne out by not infrequent finds.

Such “heavy” currencies, mainly characteristic of European lands, show the employment of metals from which implements would normally be made. The impact upon this system of the gold of the East, and later of the silver of Greece, produced the need to value such metals in gold and silver, and this in turn resulted in the need to control and guarantee the quantity of gold and silver so used to avoid constant weighing. Once gold (and then silver) gained acceptance as conveniently small expressions of relatively high value, with a visible mark of guarantee, the stage of true coinage, as it first appeared in Asia Minor and India, had been reached. Not all lands, however, adopted true coinage: the easternmost fringes of the Greek world lacked it, and Carthage and Etruria were without coinage until the 5th century AD.

Being made in most ages of precious metal, or alternatively possessing a substantial token value, coins have always been prized, often hoarded, and, therefore, frequently buried for safety. The contents of such savings banks have been dug up in all ages, so that the coins of past civilizations continue to be found in vast numbers. Studied alongside literary or archaeological evidence, they yield a wide range of information that is especially valuable for chronology and economic history. Coins may reflect the wealth and power of cities and states, and study of their distribution may help to define the physical extent of territorial dominion or to illustrate major commercial connections. Thus, the popularity in ancient times of Athenian coins in the Levant and of Corinthian silver in Magna Graecia (southern Italy) testifies to established trade links. Finds of early Roman imperial gold in India corroborate the reference of the Roman historian Pliny the Elder to the drain on Roman gold to pay for Indian and other Eastern luxuries. Likewise, huge finds of Arab silver coins in Scandinavia show the extent of trade, in particular the demand for furs by the ʿAbbāsid caliphs and the Sāmānid rulers of Iran. One result of such widespread commercial contacts is that certain currencies acquired special international preeminence. In ancient times, those of Athens, Corinth, and Philip II of Macedon were widely popular. The uniform coinage of Philip’s son Alexander the Great was struck at mints widely scattered throughout his vast empire and was universally accepted. In medieval times, the gold dinars (a term derived from the Roman denarius) of the early caliphs and the gold ducats of Florence and Venice played a similar role—as did the silver dollars of Mexico, the Maria Theresa of Austria, and the gold sovereigns of Great Britain in modern times. Moreover, the study of depreciation and debasement of coinage may illuminate past national financial distress. For example, the heavily alloyed 3rd-century-AD Roman antoniniani (coins introduced by the Roman emperor Caracalla, originally having a value of two denarii) tell their tale as clearly as the depreciating paper currency of Germany in and after 1919.

No less valuable than the economic evidence yielded by a comparative study of coins is their purely documentary importance. Together with medals, they present an unrivaled series of historical portraits from the 4th century BC to the present day, many of them otherwise unknown, like the Greco-Bactrian kings or certain usurpers during the Roman Empire. Greek coinage is a particularly notable contribution to the history of art, displaying not only the beauty and strength of many artistic traditions but also (like Roman coinage) the miniature likenesses of numerous large-scale sculptural and architectural works now lost. The imperial coinage of Rome, apart from its portraiture, is important above all for the remarkable detail of its chronological and political content; and from both Greek and Roman coins much can be learned of mythology and religion. The Christian influences active in medieval Europe can be similarly measured from medieval currencies.

The principal metals of which ancient coins were made were electrum, gold, silver, copper, brass, and bronze—all of them more or less resistant to decay. Their use at first was generally dictated by availability. The earliest coins of Asia Minor were of electrum, a natural occurring alloy washed from Lydian rivers (electrum was later produced artificially). Gold became the major currency metal of southwestern Asia as a whole, being derived from Scythian, Pontic, and Bactrian sources. The city-states of the Greek mainland preferred the silver that adjacent mines supplied, and the mines of Italy led to the choice of bronze for the earliest coinage of Rome. With the development of internal economies and external trade, gold, silver, and copper or bronze quickly came to be used side by side; Philip II of Macedon popularized gold in Greece, but it became paramount only in the Byzantine and Arab empires and in the great commercial currencies of the Italian republics of the 13th century onward. Silver, however, was nearly always powerful in Roman currency and was the major coinage metal of Europe from the 8th to the 13th century. Bronze or copper was first used for small change in Greece from the late 5th century BC and in the Roman and Byzantine systems as well; the vast currency of China consisted of base metals down to modern times.

The foregoing metals furnished most currencies until the early 20th century, when the appreciation in value of gold and silver and the need to economize led to the general production of paper currencies for the higher units of value. Token units of lower value expressed in terms of nickel (used, exceptionally, in Bactria in the 2nd century BC), cupronickel, bronze, and, in times of postwar stress, aluminum and aluminum bronze supplemented precious metals in some countries. Lead, which may easily decay, has seldom been used for coinage, except by the Andhras (inhabitants of the Deccan in ancient India), in pre-Roman Gaul, and in the more recent coinages of the Malay states. Iron, very occasionally used in antiquity—e.g., in Sparta—reappeared in German coins of World War I. Zinc was employed by Rome as a constituent of fine brass coins and as an element in the alloy of a few Chinese coins from the 15th to the 17th century. Base metals furnished the material for some Celtic coins in Gaul and Britain in the last century BC. In crises, currencies have been produced from leather, cloth, card, paper, and other materials.