A Short History of Gold

3600 BC: First gold smelting

Before 3600 BC, gold was always used as it was mined without any refinement. The ancient Egyptians were the first people to smelt gold. They used fire-resistant clay to make kilns where they would smelt the raw gold to produce a pure gold. 

 

2600 BC: First gold ornaments

The first gold ornaments were created in ancient Mesopotamia. The piece was a Lapis headdress with leaf-shaped gold adornments attached to carnelian beads. 

 

1223 BC: Tutankhamun’s mask

A notable example of gold artistry is Tutankhamun’s funeral mask. The amount of gold and the skill used in its creation have made it the most recognizable gold piece from the ancient world.

 

564 BC: First gold coins

Even though gold was used for trade, it had never been coined into a standard currency until King Croesus, the Lydian ruler, created the first gold coins. They were called Croesids, and many civilizations recognized these currencies and traded using them. The prominence grew after the Lydian empire was conquered by the Persians. The Persians later adopted it as one of their metal coins.

 

500 AD: Chinese gold coin

A thousand years after the creation of the Croesids, the Chu Dynasty circulated a square gold coin called the Ying Yuan. 

 

1300: Hallmarking established

Before 1300, the coins that were created had many impurities. There was a need to ascertain the quality of precious metals including gold. The first hallmarking office was established in London. Today, it is located in the Assay Office in London.

 

1370-1420: The gold bullion famine

In the period leading up to 1370, the rate of gold mining increased exponentially. By 1370, European gold mines became exhausted. Many people started hoarding gold, and the price of gold skyrocketed. Europe had to result to acquiring gold by trading.

 

1717: British Gold Standard

In 1489, King Henry VII declared the United Kingdom the first gold sovereign. By 1717, the country adopted the first gold standard. Essentially, the pound became the first currency to be linked to a specific quantity of gold. The standard was 10 pennies per gold ounce.

 

1848: American Gold Rush

While building his sawmill, John Marshall discovered some flakes of gold in Sacramento, California. News spread across the globe, and over 40,000 prospectors descended on California, making it the world’s most renowned gold rush.

 

1885: Gold Rush in South Africa

George Harrison, an Australian Miner, found gold ore while digging up stones near Johannesburg. A large number of gold prospectors flock to South Africa to source gold. Within a few years, South Africa becomes the world’s largest source of gold, producing 40 percent of the gold mined in the world. 

 

1925: International gold standard adoption

Before 1900, most countries had adopted the gold standard. However, during the outbreak of World War I, most countries suspended so that they can amass a large military arsenal without losing their gold reserves. In 1925, most countries shifted back to the gold standard to stabilize their currencies from rampant inflation. 

 

1933: Roosevelt departs from the gold standard

Roosevelt suspended the conversion of dollars to gold and forbade individuals from possessing gold. In 1934, the dollar was once again convertible to gold, but private individuals were still restricted from trading in gold. 

 

1939: Close of the international gold market

In 1939, the gold market in London had to be closed after the outbreak of World War II. However, in 1946 the gold market was reopened after Germany’s defeat. However, the international gold standard was replaced by nominally convertible currencies. Most of these currencies slowly shifted to the dollar as the base reserve currency. Additionally, the Bretton Woods organizations were established. 

 

1961: Gold in Space

NASA officially started to use gold in certain components of space shuttles to protect them from radiation in space. By 1980, most space shuttles used over 40kgs of gold in electrical contacts and fuel-cell fabrication. 

 

1971: Collapse of Bretton Woods Agreement

In 1971, President Nixon made an executive order disavowing the Bretton Woods Agreement. Most global currencies were no longer linked to the value of gold. Instead, the dollar became the main base currency. 

 

1999: CBGA is agreed

European central banks decided that gold should remain a vital part of their wealth reserves. They also capped the sale of gold at 400 tons each year. In 1997, the United States allowed individuals to store their wealth in tangible gold through IRS approved IRA.

 

2010: Pressure from the World Bank

After the global fiscal crisis, the World Bank president suggested that countries should return to the gold standard to reduce the economic problems associated with floating exchange rates. The World Bank had noted that gold prices appreciated during the crisis.

 

2014-2015: Royal Mint reopens

The Royal Mint Trading platform is opened, and investors are allowed to purchase gold bullion. In January 2015, RMR branded gold bullion is available for gold investors to purchase after half a century. In June 2015, Signature Gold was launched allowing the purchase of gold for as low as 20 pounds and store the money in the Royal Vault.