Coins in the Mediterranean

The story

Paying without coins

Before coins, buying something was more complicated. You could barter: three sheep in exchange for a tool, a sack of grain for a jar of oil. But barter only works if the person who has what you want wants in turn what you have. For larger payments precious metals were used, such as silver, cut into pieces or in the form of ingots, and they were weighed on a balance at every exchange. It was slow work, and you had to trust the person weighing and the purity of the metal.

The kingdom of Lydia

The great novelty took place in Lydia, a kingdom of western Anatolia, in present-day Turkey, whose capital was Sardis. The river Pactolus, which flowed nearby, was the source of electrum, a natural metal that is an alloy of gold and silver. The Lydians collected it and began to make small discs of fixed weight from it, on which they stamped a mark, an image that guaranteed who had made them and what they were worth. According to scholars, these were the first known coins.

The dates are not certain. One source says that the first metal coins date from the end of the 7th or the start of the 6th century BC; another speaks of about 650 BC, because some Lydian and Greek coastal coins were found under the temple of Artemis at Ephesus, which is thought to date from that period. In general, the birth of coinage in Lydia is placed between about 650 and 575 BC, in the time of King Alyattes.

What they were like

Lydian coins contained roughly 45–55% gold. A curious fact: the natural electrum of the region usually has a higher percentage of gold, between 70 and 90%, so scholars think that the Lydians added refined silver, which means they already knew how to work silver in an advanced way. A typical coin weighed about 4.7 grams and was worth a third of a stater. Three coins made a stater, which corresponded roughly to a soldier's pay for a month. For small purchases there were also tiny fractions, down to a ninety-sixth of a stater.

The flaw of electrum

Every electrum coin had a problem, however. Because the amount of gold could vary from one piece to another, it was hard to know what it was really worth. Whoever received a coin could not be sure. This slowed down trade.

The solution came around 560–550 BC with the “croeseid” coins, named after King Croesus: they were of pure gold or pure silver, so their value was clear. Electrum, however, went on circulating for a long time, until about 350 BC.

Coinage spreads

The idea caught on. The Greek cities of the nearby coast, which traded with the Lydians, began to strike coins of their own, each with its own symbol, and from there the custom spread across the Mediterranean. On coins people put animals, heads of gods, plants, buildings and, in time, the faces of rulers. They were at once a means of payment and a form of advertising and propaganda.

Why it was so important

Coinage solved a fundamental problem: it gave a common value to all things. A price expressed in coins made it possible to compare a piece of cloth with a sack of grain. A seller could receive a payment and spend it elsewhere, without having to find someone who wanted precisely his goods. It was easier to pay wages, collect taxes, lend money and save.