From Asia Minor to the river Nile
Long before gold was used in any way as a monetary metal, early cultures made use of the noble metal's special properties to make articles of daily use, jewellery and religious objects.
Gold deposits were first discovered in Mesopotamia – the land between Tigris and Euphrates – and Egypt, and these regions became centres for its early use. In these areas, gold was initially won by washing the river sand. Its earliest known use in jewellery dates back over 5,000 years to the Sumerian culture, located in modern-day Iraq. In the time between the two World Wars, archaeologists excavated the Royal Tombs at Ur and discovered a golden treasure trove that illustrated the extraordinary capabilities of the ancestors of today’s jewellers.
But the peoples of Asia Minor were not the only ones working with gold; the civilisation along the Nile was using it already by the fourth millennium B.C. The Egyptians were forerunners in developing processes for melting metal. Using blowpipes, they managed to generate temperatures high enough to melt the metal they had discovered. This enabled them to not only directly process larger gold nuggets but they could also work with smaller grains and thin flakes by melting them together in crucibles before processing.
From electrum to gold
However, roughly a thousand years passed from the earliest use of precious metals until ancient cultures were able to produce nearly pure gold. Up to that time, the metal known as electrum to the Egyptians was always gold alloyed with silver because the melting points of these two metals were too close for exact separation, or refining, using the technology available at the time.
Later, the people living at the banks of the Nile developed the art of creating alloys by adding copper, for example. This enabled them to produce objects that were far harder than those made from the relatively soft pure gold. It also allowed them to introduce colour nuances, a process that is still used to this day. A high copper content, for example, gives the South African Krugerrand gold coin a reddish colouration.
But the Egyptians didn’t just limit themselves to processing the gold carried down the Nile from the Abyssinian Highlands: They were also the first to develop a gold mining system. They possessed an amazing ability to locate gold deposits, even from a modern perspective, and numerous archaeological findings today point to the sheer number of gold mines that ancient societies used to exploit reserves between the Nile and the Dead Sea. Experts estimate the amount of gold processed by the Egyptians at about 850 tons, but distributed over a period of about 1,000 years. That roughly equates to the current-day annual production of South Africa and the USA together.
From Egypt to Rome
Knowledge about the extraction and processing of precious metals spread from Egypt to all the other advanced civilisations in the region at that time. The Egyptians’ legacy later descended to the Romans, who also mined for gold in today's Balkan region and in the Spanish provinces. Annual output during the Roman Empire is estimated at 5 to 10 tons. A large part of the technical expertise in precious metals was lost with the fall of the Roman Empire, and it took almost another 1,000 years before humanity reached the level of Roman times once more.
From medieval times to America
In Europe during the Middle Ages, gold was primarily won using primitive washing techniques again. Only some areas in Central Europe had mines, including the Fichtelgebirge and Harz Mountains, Bohemia, Silesia and the Alps.
During the 1,000 years between the fall of the Roman Empire and the discovery of America, experts estimate gold yields at 300 to a maximum of 600 tons, thus reaching only a fraction of the total output of ancient times.
But Mediterranean countries and their bordering European neighbours were not the only ones to develop a preference for that precious metal. For example, China was already mining and working gold in 1,000 B.C. The same is true for regions south of the Sahara, and of course for the ancient Indian cultures in Central and South America.
Gold’s role in history received another boost in the 15th and 16th century when Christopher Columbus discovered America while searching for a sea route to India. He hadn’t even been confronted with South America's vast riches on his first voyages, and yet he wrote the following in his letters from Jamaica dated 1503: "Gold is most excellent; gold is treasure, and he who possesses it does all he wishes to in this world, and succeeds in helping souls into paradise." And in 1511, King Ferdinand's words to his departing soldiers were: "Get gold, humanely if possible, but at all hazards – get gold".
From all over the world to the Iberian Peninsula
The Spanish and Portuguese fleets dominated the Atlantic for the next 200 years, their galleons returning home laden with gold and even more silver. The conquistadors gathered unbelievable riches, from both an artistic as well as intrinsic value perspective.
However, most of these works of art were irretrievably lost to the conqueror's smelters, and the quest to locate the mysterious city of El Dorado was ultimately unsuccessful despite all their efforts and apparent successes. Why? Because the search for new gold deposits never led to any tangible results. The new masters had too little experience in geology and mining, and pursued their policy of genocide mercilessly – robbing themselves of a potential workforce in the process.
Nevertheless, the conquered gold and silver combined with the comparatively small amount that could be wrung from the earth launched an economic boom back home in Europe, the like of which had not been seen since the Middle Ages.
By the 17th century, however, global gold production had declined again to less than 10 tons per year. During this time, precious metals were initially traded in Amsterdam, until London established itself as the new centre for gold and silver trading in the last quarter of the 17th century.