According to Greek historian Herotodus, writing in the fifth century BCE, the first people to use gold and silver coinage were the Lydians, who inhabited an kingdom mostly in the area of modern-day Turkey.
Modern historians believe Herotodus’ account to be mostly accurate. They believe that the use of precious metals as coins began somewhere between the 7th and 5th centuries BCE, and were primarily made of electrum, a natural alloy of gold and silver found in the region’s rivers.
It appears that the early Lydian electrum coins were minted both by merchants, to be used as placeholders in trade transactions, as well as the state. The Lydian Kingdom minted coins that mention their ruler, Alyattes of Lydia. Often, these coins would have a bull or lion on the face side, and a punch mark on the obverse side.
Alyattes was succeeded by his son, Croesus. King Croesus is associated with improvements to refinement processes that led to the minting of distinct gold coins, as well as the introduction to the coins to the masses.
The basis of the weight system in Lydian coinage was the stater, equal to about 0.45 Troy ounces or 14.1 g. The third-stater, or trite, was the most common fractional coin used, which was, just as it sounds, 1/3 the weight of the stater. The stater would also come to be divided into fractional units of 1/6, 1/12, 1/24, 1/48, and 1/96 (about 0.005 Troy ounces or 0.15 g). These smaller fractional units were difficult to distinguish from each other by appearance and size alone, leading historians to assume that scales must have been used for most transactions in which they were involved.
In 546 BC, Croesus was captured by the Persians, who adopted gold as the primary metal for their coinage. The use of gold coins had also begun to spread around the coastal areas of Greece, and by the time Alexander the Great united Greek and Persian regions under one empire, he became heir to a large quantity of gold coins from the regions he conquered.
Greek rulers began to mint their likenesses on the front of coins, a practice that continued into Roman times and until this day.