How was the value of electrum coins determined in ancient times?

MKUltra24

I’ve seen a lot of coins from the 5th century BC and earlier and many of them are made of electrum.

But the thing about electrum is that it is an alloy of silver & gold.

Gold was always worth at least 8x as much as silver in ancient times and usually more than that so an electrum coin that was 80% silver 20% gold would be worth much less than a coin of the same type that was 80% gold and 20% silver.

So in ancient times how would a merchant determine the value of electrum coins?

Did they just accept all of the coins of that type at face value or did they somehow determine the gold/silver alloy percentages and give more value to the coins with a higher gold content even if they were the same coin?

MrEureka

Was there any time and place in history where electrum coins of substantially different alloys circulated side by side?

tcollects

@MrEureka said:
Was there any time and place in history where electrum coins of substantially different alloys circulated side by side?

you think not, right, because of all the known situations in history where that arbitrage was possible and happened almost immediately?

interesting

MKUltra24

@MrEureka said:
Was there any time and place in history where electrum coins of substantially different alloys circulated side by side?

Well yeah because in nature electrum is alloyed differently in different places. It’s not like all the electrum coins were made from electrum from the exact same mine.

Sapyx

Prior to the invention of coinage, people in what is now western Turkey traded in electrum nuggets, which were of a fairly consistent fineness so value could be determined based purely on weight. The theory behind electrum coinage was that everyone knew what ratio naturally occurring electrum was, and would accept the coins at that official rate, simply because the king put his stamp on the nugget.

In practice, this was simply not true. Despite the modern myth, electrum coins were not made out of naturally-occurring electrum. Chemical analysis of the remnants of natural electrum recovered from Turkish rivers near Sardis have a much higher gold content (70 to 90% gold) than even the earliest electrum coins that have been chemically analysed (45% to 55% gold). So it seems the temptation to debase the coinage was indulged immediately after coinage was invented.

To answer the OP's question, the answer is the same as any other trade dispute resolution in the Near East: "by haggling". Of course, arguments about gold content and relative value of electrum coinage were the main reason why electrum was abandoned as a coinage metal. If they're going to go to the trouble of refining and separating the gold and silver, only to re-mix them into an alloy again for making coins, you'd have needed for there to be a distinct advantage for electrum coinage to exist. There wasn't one.

MKUltra24

@Sapyx said:
Prior to the invention of coinage, people in what is now western Turkey traded in electrum nuggets, which were of a fairly consistent fineness so value could be determined based purely on weight. The theory behind electrum coinage was that everyone knew what ratio naturally occurring electrum was, and would accept the coins at that official rate, simply because the king put his stamp on the nugget.

In practice, this was simply not true. Despite the modern myth, electrum coins were not made out of naturally-occurring electrum. Chemical analysis of the remnants of natural electrum recovered from Turkish rivers near Sardis have a much higher gold content (70 to 90% gold) than even the earliest electrum coins that have been chemically analysed (45% to 55% gold). So it seems the temptation to debase the coinage was indulged immediately after coinage was invented.

To answer the OP's question, the answer is the same as any other trade dispute resolution in the Near East: "by haggling". Of course, arguments about gold content and relative value of electrum coinage were the main reason why electrum was abandoned as a coinage metal. If they're going to go to the trouble of refining and separating the gold and silver, only to re-mix them into an alloy again for making coins, you'd have needed for there to be a distinct advantage for electrum coinage to exist. There wasn't one.

Hey @Sapyx I got a few coins of the kind that I think you were referring to from what is now Turkey!

Did you mean these?

Sapyx

These certainly are early Electrum coins.

John Conduitt

@MKUltra24 said:
So in ancient times how would a merchant determine the value of electrum coins?
Did they just accept all of the coins of that type at face value or did they somehow determine the gold/silver alloy percentages and give more value to the coins with a higher gold content even if they were the same coin?

I would've thought people could tell the approximate percentage of gold by the colour.

@Sapyx said:
Despite the modern myth, electrum coins were not made out of naturally-occurring electrum. Chemical analysis of the remnants of natural electrum recovered from Turkish rivers near Sardis have a much higher gold content (70 to 90% gold) than even the earliest electrum coins that have been chemically analysed (45% to 55% gold). So it seems the temptation to debase the coinage was indulged immediately after coinage was invented.

I believe it was the possibility of debasement that resulted in the invention of coins in the first place. The authorities could make a profit while issuing debased electrum with an official stamp, driving demand by paying soldiers' wages in it and insisting that's how you paid taxes.

MKUltra24

@JohnConduitt said:

@MKUltra24 said:
So in ancient times how would a merchant determine the value of electrum coins?
Did they just accept all of the coins of that type at face value or did they somehow determine the gold/silver alloy percentages and give more value to the coins with a higher gold content even if they were the same coin?

I would've thought people could tell the approximate percentage of gold by the colour.

@Sapyx said:
Despite the modern myth, electrum coins were not made out of naturally-occurring electrum. Chemical analysis of the remnants of natural electrum recovered from Turkish rivers near Sardis have a much higher gold content (70 to 90% gold) than even the earliest electrum coins that have been chemically analysed (45% to 55% gold). So it seems the temptation to debase the coinage was indulged immediately after coinage was invented.

I believe it was the possibility of debasement that resulted in the invention of coins in the first place. The authorities could make a profit while issuing debased electrum with an official stamp, driving demand by paying soldiers' wages in it and insisting that's how you paid taxes.

I think I recently read in Herodotus’ “The Histories” that it was Croesus who invented the first “pure” gold & silver coins establishing the first bimetallic standard with a ratio of 1:12.

These electrum coins are even older but they’re not pure gold or pure silver so Croesus gets the credit for that but I do consider them to be the oldest form of coinage.

MKUltra24

@Sapyx said:
These certainly are early Electrum coins.

What’s really crazy is that even the 1/24th stater (the smallest one) was still worth over a day’s wages! (I read 1 gold stater per month was the average pay at this time).

It’s extremely tiny! It looks bigger in the picture but it’s even smaller than my Miletus obol (1/6th drachma).

I imagine these coins must’ve been extremely frustrating to deal with due to size.

It makes me wonder if that’s why a few centuries later they switched to larger high purity silver coins for medium sized transactions such as the drachma, denarius, stater, siglos (Persia), etc.,

John Conduitt

@MKUltra24 said:

@Sapyx said:
These certainly are early Electrum coins.

What’s really crazy is that even the 1/24th stater (the smallest one) was still worth over a day’s wages! (I read 1 gold stater per month was the average pay at this time).

It’s extremely tiny! It looks bigger in the picture but it’s even smaller than my Miletus obol (1/6th drachma).

I imagine these coins must’ve been extremely frustrating to deal with due to size.

It makes me wonder if that’s why a few centuries later they switched to larger high purity silver coins for medium sized transactions such as the drachma, denarius, stater, siglos (Persia), etc.,

This was a problem that continued into the modern era.

In medieval England, they cut the silver pennies into halves and quarters to get change - these were small bits of silver, but they were still worth a lot. Æthelstan (924–39) set the price of a pig at 10 pence, so half a penny was a fifth of a pig. That's a lot of bacon.

Elizabeth I stopped minting farthings because they would've been too small to use (given the prevailing price of silver), which left everyone with no coins for small transactions. So she struck a three farthing coin so that people would be able to give change for a penny.

The problem was only overcome by using bronze/copper (not achieved in Britain until the 1600s) or cutting the link between face value and intrinsic value, which required a reliable banking system.

RSP

Knowing nothing about ancient coins, I would have to say that this post/comments is the most interesting of the year.

Namvet69

Gotta love CU cause the year is just starting. I would think they were doing specific gravity tests even back then, gaining insight into coin metal composition. Peace Roy

Sapyx

@Namvet69 said:
Gotta love CU cause the year is just starting. I would think they were doing specific gravity tests even back then, gaining insight into coin metal composition. Peace Roy

If by "back then" you mean back when these electrum coins were made, then no. The principle of specific gravity measurement was discovered by Archimedes of Syracuse sometime around 250 BC, and published in 246 BC. The story goes that, as the royal problem-solver, he was tasked by the king of Syracuse with determining whether or not a crown, made by a goldsmith using the king's gold, had been illegally adulterated with silver - without destroying the crown in the process. It was the original "Eureka moment"; he was in the public bath, watching the water level go up and down as people got in and out of the bath, when he thought of the idea of immersing the crown in water to accurately measure it's volume and thus determine its density, and was so excited to find the answer he burst out into the street still naked, shouting "eureka" (Greek for, "I have found it"). It turned out that the crown had indeed been diluted with silver.

Whether this story is true or myth, the basic concept was unknown to the ancient world prior to Archimedes. And these electrum coins date from long before 246 BC. A skeptical citizen could have melted down the coins to measure the volume and determine their purity, but they didn't have the knowhow to actually measure the volume of an irregularly-shaped solid object like an ancient coin.

MKUltra24

@JohnConduitt said:

@MKUltra24 said:

@Sapyx said:
These certainly are early Electrum coins.

What’s really crazy is that even the 1/24th stater (the smallest one) was still worth over a day’s wages! (I read 1 gold stater per month was the average pay at this time).

It’s extremely tiny! It looks bigger in the picture but it’s even smaller than my Miletus obol (1/6th drachma).

I imagine these coins must’ve been extremely frustrating to deal with due to size.

It makes me wonder if that’s why a few centuries later they switched to larger high purity silver coins for medium sized transactions such as the drachma, denarius, stater, siglos (Persia), etc.,

This was a problem that continued into the modern era.

In medieval England, they cut the silver pennies into halves and quarters to get change - these were small bits of silver, but they were still worth a lot. Æthelstan (924–39) set the price of a pig at 10 pence, so half a penny was a fifth of a pig. That's a lot of bacon.

Elizabeth I stopped minting farthings because they would've been too small to use (given the prevailing price of silver), which left everyone with no coins for small transactions. So she struck a three farthing coin so that people would be able to give change for a penny.

The problem was only overcome by using bronze/copper (not achieved in Britain until the 1600s) or cutting the link between face value and intrinsic value, which required a reliable banking system.

You mean 1/2 pence = 1/20 pig right?

If 10 pence = 1 pig
Then 1 pence = 1/10th pig
In which case 1/2 pence = 1/20 pig.

Not trying to be a smart arse it just seemed a bit too high so I did the math in my head lol.

MKUltra24

@Sapyx said:

@Namvet69 said:
Gotta love CU cause the year is just starting. I would think they were doing specific gravity tests even back then, gaining insight into coin metal composition. Peace Roy

If by "back then" you mean back when these electrum coins were made, then no. The principle of specific gravity measurement was discovered by Archimedes of Syracuse sometime around 250 BC, and published in 246 BC. The story goes that, as the royal problem-solver, he was tasked by the king of Syracuse with determining whether or not a crown, made by a goldsmith using the king's gold, had been illegally adulterated with silver - without destroying the crown in the process. It was the original "Eureka moment"; he was in the public bath, watching the water level go up and down as people got in and out of the bath, when he thought of the idea of immersing the crown in water to accurately measure it's volume and thus determine its density, and was so excited to find the answer he burst out into the street still naked, shouting "eureka" (Greek for, "I have found it"). It turned out that the crown had indeed been diluted with silver.

Whether this story is true or myth, the basic concept was unknown to the ancient world prior to Archimedes. And these electrum coins date from long before 246 BC. A skeptical citizen could have melted down the coins to measure the volume and determine their purity, but they didn't have the knowhow to actually measure the volume of an irregularly-shaped solid object like an ancient coin.

Dang Sapyx you’re just full of knowledge! ^_^

Namvet69

@Sapyx Thanks for sharing, you made my morning coffee most enjoyable. Be safe. Peace Roy

John Conduitt

You mean 1/2 pence = 1/20 pig right?

If 10 pence = 1 pig
Then 1 pence = 1/10th pig
In which case 1/2 pence = 1/20 pig.

Not trying to be a smart arse it just seemed a bit too high so I did the math in my head lol.

Yes thanks . I noticed that too late. I was going to edit but if I do that it seems to delete the post and put it into quarantine, so I couldn't be bothered. The point is the same.

John Conduitt

@Sapyx said:

It was the original "Eureka moment"; he was in the public bath, watching the water level go up and down as people got in and out of the bath, when he thought of the idea of immersing the crown in water to accurately measure it's volume and thus determine its density, and was so excited to find the answer he burst out into the street still naked, shouting "eureka" (Greek for, "I have found it"). It turned out that the crown had indeed been diluted with silver.

I always wondered about this story. If you're in a public bath, or any bath bigger than a tub, can you really see the water level change? Not unless a whole phalanx got in.

MKUltra24

Wellll..it looks like I’ll never have the full 1 stater coin of Ionia. O_o

Sapyx

@JohnConduitt said:

@Sapyx said:

I always wondered about this story. If you're in a public bath, or any bath bigger than a tub, can you really see the water level change? Not unless a whole phalanx got in.

I don't think we know for sure the style of bath-house in Syracuse back in Archimedes' day (I think it depended a lot on the quantity of available water in the city), but the Greek habit probably wasn't a Roman-style large communal tub or a modern-day swimming pool. In nearby Gela (which was destroyed in 282 BC so the city was never "Romanized", leaving the ruins entirely Greek in style), the excavated bath-house contains individual tubs, arranged in two circles. So while bathing was a communal activity, people still sat in individual tubs. In Gela, they had a catchment basin in the middle of the circle, to catch the overflow water from each tub, for recycling, and while the water was pumped into the tubs via pipes, the tubs and the room as a whole didn't actually have any drains, with waste water from the tubs and basin needing to be removed by hand - so I'm guessing Gela was a "water-poor" city, and they didn't let any of their used bath-water go to waste.

If the Syracuse bath-house was like the Gela bath-house, I can readily imagine Archimedes sitting in his tub in the circle, watching the other gentlemen of the city get in and out of the their tubs, and their overflow water spilling out and flowing down into the basin. It's not "proof", but "plausible".

MKUltra24

@Sapyx said:

@JohnConduitt said:

@Sapyx said:

I always wondered about this story. If you're in a public bath, or any bath bigger than a tub, can you really see the water level change? Not unless a whole phalanx got in.

I don't think we know for sure the style of bath-house in Syracuse back in Archimedes' day (I think it depended a lot on the quantity of available water in the city), but the Greek habit probably wasn't a Roman-style large communal tub or a modern-day swimming pool. In nearby Gela (which was destroyed in 282 BC so the city was never "Romanized", leaving the ruins entirely Greek in style), the excavated bath-house contains individual tubs, arranged in two circles. So while bathing was a communal activity, people still sat in individual tubs. In Gela, they had a catchment basin in the middle of the circle, to catch the overflow water from each tub, for recycling, and while the water was pumped into the tubs via pipes, the tubs and the room as a whole didn't actually have any drains, with waste water from the tubs and basin needing to be removed by hand - so I'm guessing Gela was a "water-poor" city, and they didn't let any of their used bath-water go to waste.

If the Syracuse bath-house was like the Gela bath-house, I can readily imagine Archimedes sitting in his tub in the circle, watching the other gentlemen of the city get in and out of the their tubs, and their overflow water spilling out and flowing down into the basin. It's not "proof", but "plausible".

Now I want an ancient coin with Archimedes and one of his inventions on it xD

Weiss

Just using the thread as an excuse for posting my icon.

MKUltra24

@Weiss said:
Just using the thread as an excuse for posting my icon.

I would jump at the chance to buy that at the price you got it xD

Weiss

@MKUltra24 said:

I would jump at the chance to buy that at the price you got it xD

You can! Just work with a leading, trusted coin dealer in your field. Buy one of the better pieces you can afford. Wait 17 years (get that piece slabbed along the way) and voila!

MKUltra24

@Weiss said:

@MKUltra24 said:

I would jump at the chance to buy that at the price you got it xD

You can! Just work with a leading, trusted coin dealer in your field. Buy one of the better pieces you can afford. Wait 17 years (get that piece slabbed along the way) and voila!

I will get one one day..but it might be a while.

Probably in XF condition to keep the price as low as possible without sacrificing too much.

That’s probably the largest one I could do since the full 1 stater coin is 5 figures.

Apparently I still need the 1/48 and 1/96 too.