All countries need some currency system to handle trade and it can be anything from stones, metals, animals, and food. Throughout history, different commodities have played the role of money and served both as a medium of exchange and as a store of value but the universal appeal of the gold market remained unparalleled. For hundreds of years, gold has been coveted for its beauty and rarity.
Gold became recognized as a medium of exchange when the gold-bearing regions of Nubia made Egypt a wealthy nation. The first gold coins were minted around 550 BC by the order of King Croesus of Lydia. The ancient Greeks used gold as money, learning about the practicalities of gold mining.
Gold circulated as currency in many countries. As trade routes became wider, Romans began issuing a gold coin called the aureus, which had been widely used as payment for their administrators, traders, and soldiers. They furthered the quest for gold and advanced the science of gold mining considerably. Gold coins had become the standard currency in Europe and the Middle East by 1200 A.D. This trend steadily continued for centuries. Gold as a monetary standard caused the world’s economies to expand and prosper.
By 1900, The United States of America and many of the world’s major countries used the single gold standard as their method of currency. Major currencies were fixed to gold at a set price per ounce, under the ‘Gold Standard’. Advancements in coin creation methods led to the stamping of images on the surface of the coins. Later on, kings and queens began to demand that their images be stamped on certain pieces of currency.
Gold Used As Money
To make a commodity suitable to use as money, it must have certain characteristics such as stability, portability and durability. So, why is gold used as a currency? Here are some reasons why gold is golden:
- Gold is portable, easier to carry than a sack of rice. A family’s entire wealth can be put in a small bag and carried away.
- Gold is lasting. It can be handed down from one generation to another without losing its value.
- The supply of gold has been stable across centuries. Unlike paper money which can be easily produced (and therefore lower its value), it is unlikely that new mines will be produced any time soon.
- Gold has only one grade making it liquid and can be converted to cash quickly.
- One country’s currency may not be recognized in other parts of the world. Gold is universal and is recognized all over the world.
Nowadays people don’t use gold as a currency but they definitely use it as a store of value. There are many companies that offer things like Gold IRAs and such but it’s really important to choose a reputable company. You’ll want to read as much as you can before choosing a Gold IRA company or making a decision.
There are a lot of companies like Lear Capital and Regal Assets that offer these investment instruments. You can read a review of regal assets here, but again you should always talk to a financial advisor before making decisions.