The Origin of Coins and Money

The first manufactured actual coins seem to have appeared in the cities around the Aegean Sea, while there are also references about coins in India and China, between 700 and 500 BCE. All modern coins are descended from the coins that appear to have been invented in the Kingdom of Lydia, in Asia Minor, at the end of the 7th century BCE, somewhere around the year 600 BCE, and that spread throughout Greece and other Mediterranean countries such as Italy in the following centuries.

   The coins produced in that period were disk-shaped, made of gold, silver, bronze or imitations thereof, with both sides bearing an image produced by stamping. Furthermore, the one side was often a human head. In 600-480 BCE animals most commonly appeared on coins, usually the symbol of the issuing polis or associated with the city’s main religious cult. After 480 BCE, the human face and intricate scenes began to appear, due to better minting techniques.

   One of the first stamped coins is an electrum stater (an ancient coin used in various regions in Greece, an occurring alloy of gold and silver with trace amounts of copper and other metals) of a turtle coin, coined at Aegina island, from around 600-550 BCE.

   Coins made of electrum were manufactured on a larger scale about 650 BCE in Lydia, and soon became adopted in mainland Greece, and the Persian Empire (after it incorporated Lydia in 547 BCE). With their capital at Sardis, the Lydians traded with the Greeks and from there the use of coins spread to all of Greece and its colonies.

   Although early coins were made of electrum, most of coins after the development of the money as an important medium of exchange were made of gold or silver, which guarantees the purity of each coin.

   According to Herodotus, the Lydians were the first people to use gold and silver coins and the first to establish retail shops in permanent locations.

   In Greece, it was a matter of pride for a Greek city state to mint its own coins, which was a sign of its independence. The only exception to this used to be Sparta, which continued to use iron rods instead of coins until the 4th century BCE.