Extremely unique and truly invaluable, gold has consistently proven to be man’s best and most universally accepted honest store of wealth for over 5,000 years. It is impossible to imagine a more thorough and compelling test than the test of time. Gold’s historical significance rests largely around the critical human need to transact efficiently in commerce with a consistent measure of value, and to store one’s excess economic production reliably, otherwise known as a store of value.
In contrast, the world’s longstanding reserve currency, the almighty U.S. Dollar, has depreciated (or devalued) over 95% of its purchasing value since President Franklin D Roosevelt confiscated gold money and bullion in 1933, just 90 years ago. Gold, however, has preserved its basic purchasing power for millennia. While some “argue” against gold’s well-earned designation as sound money, they have and will be proven wrong by experience for generations to come.
Follow along as we discuss the fascinating history of gold bars and the relevancy of the kilo gold bar’s introduction to the bullion family.
Bullion bars of a uniform content and size, called gold ingots, were the predecessor to coinage as early civilizations evolved from a barter trade economy to a more efficient monetary-based economy. In fact, gold and silver bullion bars were used as a substitute currency for large transactions, even throughout the 1800s gold and silver rush periods in the American West. Since recorded history, metal ingots have been used in trade, especially where coinage was less common.
Ancient Egypt was the first civilization to mine gold, circa 3000 BC, and to begin using gold as a medium of exchange around 1500 BC. Raw unparted gold, referred to as “electrum,” was fashioned into uniform ingots called shekels. Electrum ingots had a bright yellow-gold appearance, rather than the more muted red-toned color that modern-day American gold coinage alloyed with copper is known for. Possibly the world’s most significant factor in economic advancement, the use of ingot currency proliferated throughout the region.
While it is accurate to say that the origins of raw gold bar production predate historical records and even our age-old non-barter currency economies, claiming that the first gold bars were ‘produced’ over 5,000 years ago is not exactly true. Electrum, or gold in its raw natural form, includes 20% to 50% silver and possibly other natural alloys. Simple electrum ingots were available at this early stage of ancient history, but until the process of gold refining was invented a millennium later, producing actual gold bars as we understand them today, was not possible.
The process of refining raw gold began with the introduction of alluvial mining. Through this process, gold nuggets and gold dust are extracted from the earth, then separated and melted through smelting. The result was a pristine, natural gold alloy. This alloy was shaped into a raw, natural gold bar using clay molds, now commonly known as dore bars. While modern alluvial mining dates back to the mid-nineteenth century California Gold Rush era, it began along the riverbanks of the Niles thousands of years earlier. The Egyptians also began using a rudimentary refining method to separate silver from gold with salts somewhere around 2000 BC.
Gold bullion bars, as we recognize them today, are composed of nearly pure refined gold. Consequently, the true origins of gold bullion bars trace back approximately a thousand years after the introduction of electrum gold ingots, placing their inception around 4,000 years ago.
Paramount to the advancement of any civilization is the practice of saving extra economic productivity, beyond what is required to live, in a durable vehicle to preserve the surplus, or in simpler terms, to preserve wealth. To accomplish this, objects of value are acquired in various assets. Historically, grain, livestock and land were popular candidates. The desire for a more compact, recognizable, portable and durable vehicle, however, consistently made precious metals the leading choice as a store of value for thousands of years.
Of the precious metals, gold has proven the most universally accepted across many societies, cultures and geopolitical landscapes. Throughout the millenniums, gold’s purchasing exchange value has been more consistent than any other element or asset. When economic or geopolitical events diminish the value of most other assets, gold shines even more as a store of value. Though shorter-term anomalies may transpire due to gold’s incredible liquidity benefit in economic crisis, over time gold proves to be the world’s leading choice as an asset for a store of value.
To meet the demands of modern financial and international trading systems, the gold kilobar first made its premiere in the late 20th century. The concept of the impressively sized kilobar emerged in response to two specific challenges: The need for an efficient way to trade and store larger quantities of gold and a desire for a standardized unit that could be easily traded on a global scale. As the metric system fit that bill, the newly developed bullion bar was dubbed the one kilo gold bar.
The gold kilobar quickly gained acceptance in the global gold market. Today, the 1 kilo bar continues to be produced with exact standards of .9999 fine gold purity and one kilogram in weight. The kilobar’s compact size and significant, sustainable value make it ideal for large-scale transactions as well as a cornerstone for the portfolios of savvy buyers.
Our journey through the history of gold bullion bars, spanning about 4,000 years, reveals its universal appeal as a store of value across cultures. The introduction of the kilo gold bar in the late 20th century reflects gold’s evolution as a tradable asset to meet modern financial demands, offering a standardized unit and .9999 fine gold purity.
For more information about how to invest in the remarkable Kilo Gold Bullion Bars with Monex, contact one of our knowledgeable Account Representatives today.
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